Benchmarks continue to trade in red in the noon session

Indian bourses continued to trade in red in the noon session as investors nervously waited on the outcomes of the Federal Reserve and Bank of Japan policy meetings that begin later in the session. Besides, weakness in rupee against the dollar also weighed on the sentiment.  However, market participants got some comfort with global rating agency S&P projecting India to clock 8% growth over next few years and stating that India's structural reform agenda has maintained strong momentum and should propel growth higher. Some support also came with the report that FIPB will decide on 15 foreign investment proposals, including that of Idea Cellular Infrastructure Services and Sharekhan, on September 26, 2016. The government has taken slew of measures in the recent past to boost foreign direct investment into the country.  Measures undertaken by the government has resulted in increased FDI inflows at $55.46 billion in 2015-16, as against $36.04 billion in 2013-14.

On the global front, Asian markets were trading mostly in red on Tuesday as investors turned cautious ahead of the outcome of the policy meetings of central banks in Japan and the US. Global markets have been blowing hot and cold in recent weeks over the Fed's intentions, not helped by both hawkish and dovish comments from several Fed officials over this period. Further, Japan’s Nikkei Stock Index is trading lower despite bank stocks bouncing back from recent losses due to speculation that the BOJ would cut its interest rate on excess reserves further into negative territory. Meanwhile, US stocks came off their intra-day highs amid a choppy trading session to end flat with negative bias on Monday.

Back home, stocks from Oil & Gas and PSU counters were supporting the markets, while those from Realty, information technology (IT) and Auto counters were adding to the underlying cautious undertone. In scrip specific development, Lloyd Electric has jumped after the company bagged order worth $18 million from GE Transportation to supply custom designed air-conditioning units for the Indian Railways Marhowra Locomotive project. Also, Mangalam Cement has rallied after the company commenced Commercial Production of the New Cement Grinding Unit with a capacity of 0.75 Million Ton Per Annum (MTPA) at Aligarh, Uttar Pradesh.

The market breadth remained pessimistic as there were 1046 shares on the gaining side against 1264 shares on the losing side, while 158 shares remained unchanged.

The BSE Sensex is currently trading at 28530.05, down by 104.45 points or 0.36% after trading in a range of 28514.84 and 28698.81. There were 9 stocks advancing against 21 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.03%, while Small cap index down by 0.11%.

The few gaining sectoral indices on the BSE were Oil & Gas up by 0.54% and PSU up by 0.17%, while Realty down by 1.49%, IT down by 0.58%, TECK down by 0.58%, Auto down by 0.48% and Bankex down by 0.45% were the top losing indices on BSE.

The top gainers on the Sensex were ONGC up by 1.83%, Dr. Reddys Lab up by 0.90%, Maruti Suzuki up by 0.87%, Cipla up by 0.79% and Power Grid up by 0.62%. On the flip side, Hero MotoCorp down by 1.91%, Bharti Airtel down by 1.54%, Bajaj Auto down by 1.21%, Adani Ports &Special down by 1.00% and Infosys down by 0.99% were the top losers.

Meanwhile, seven telecom companies have submitted Rs 14,653 crore as Earnest Money Deposit (EMD) for the forthcoming 2,355 megahertz of airwaves auction starting from October 1. The numbers are lower of the deposit of Rs 19,711 crore in February 2015 auctions by the same operators, when lesser bands were up for grabs.

Mukesh Ambani-led firm Reliance Jio alone has deposited the highest EMD of around Rs 6,500 crore, almost the same as the combined deposits made by the top three telecoms. As per the Department of Telecommunication (DoT), Vodafone India has submitted EMD of Rs 2,740 crore, Idea Cellular Rs 2,000 crore and Bharti Airtel Rs 1,980 crore. Beside, Tata Teleservices has submitted EMD of Rs 1,000 crore, Reliance Communications Rs 313 crore and Aircel Rs 120 crore.

EMD is indicative of a company's strategy to bid in specific circles and spectrum bands; it gives them eligibility points with regard to those circles. Accordingly Reliance Jio is the only company which has potential to buy spectrum in premium 700 Mhz at floor price in most of the circles as a pan-India bidder for 700 Mhz spectrum needs to have EMD of Rs 5,610 crore. This is the first time that government will auction the 700 Mhz band, considered to be the most premium as the estimated cost of providing service through it is about one-third of 3G under the 2100 Mhz band. Total spectrum worth Rs 4,01,975 crore in 700 Mhz band is being put up for auction.

The government is putting up large chunks of spectrum for sale, which should help in removing fragmentation and improve service quality. Mobile frequencies in all bands -- 700 Mhz, 800 Mhz, 900 Mhz, 1800 Mhz, 2100 Mhz and 2300 Mhz -- will be put on the block in the upcoming auction. All the radiowaves being put up for auction can be used for providing high-speed 4G services. The government expects revenue of Rs 98,995 crore from the telecom space in 2016-17, which includes Rs 64,000 crore from the auction of about 2,354.55 Mhz of spectrum.

The CNX Nifty is currently trading at 8776.10, down by 32.30 points or 0.37% after trading in a range of 8767.45 and 8816.45. There were 20 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were ONGC up by 1.79%, Dr. Reddys Lab up by 0.80%, Cipla up by 0.77%, Maruti Suzuki up by 0.77% and Power Grid up by 0.76%. On the flip side, Hero MotoCorp down by 2.18%, Bharti Airtel down by 1.73%, Bajaj Auto down by 1.34%, Tata Motors - DVR down by 1.17% and Infosys down by 1.06% were the top losers.

Asian markets were trading mostly in red; Hang Seng 0.12%, Nikkei 225 slipped 0.33%, Jakarta Composite shed 0.29%, FTSE Bursa Malaysia KLCI fell 0.19% and Shanghai Composite was down by 0.16%. On the flip side, KOSPI Index increased 0.46% and Taiwan Weighted was up by 0.1%.