Benchmarks slump in early deals; Sensex breaches 27,900 mark

Indian equity benchmarks have made daunting start and are trading with a cut of around three fourth of a percent, with frontline gauges declining below their crucial 27,900 (Sensex) and 8,650 (Nifty) levels. Traders remained on sidelines ahead of F&O October series expiry tomorrow. Sentiments also remained down-beat with report that despite many efforts, India moved up only one position in the International Finance Corporation's (IFC) ease of doing business rankings. Disappointing earnings too dampened sentiments. Axis Bank's quarterly net profit plunged 83 percent in the September quarter, while IDBI Bank reported a 53 percent decline in quarterly net profit.

Weak global cues too weighed sentiments with most of the Asian counters trading in red at this point of time tailing weakness in US markets, as oil prices slumped and Apple Inc.’s results disappointed, also the BoE Governor Mark Carney dashed stimulus hopes. The US markets ended lower in last session as traders reacted to the latest batch of earnings news, with a number of big-name companies releasing their quarterly results.

Back home, foreign portfolio investors (FPIs) sold shares worth a net Rs 606.34 crore yesterday as per provisional data released by the stock exchanges. Traders failed to get any comfort with the Economic Affairs Secretary Shaktikanta Das’s statement that the GDP growth will be around 8 percent this fiscal, while the agriculture sector is expected to grow over 4 percent.

The BSE Sensex is currently trading at 27890.69, down by 200.73 points or 0.71% after trading in a range of 27846.40 and 28050.55. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.04%, while Small cap index was up by 0.12%.

The top gaining sectoral indices on the BSE were Telecom up by 1.21%, Consumer Durables up by 0.32%, Consumer Discretionary Goods & Services up by 0.19%, Realty up by 0.18% and Metal up by 0.14%, while Bankex down by 1.34%, Finance down by 0.81%, FMCG down by 0.69%, Oil & Gas down by 0.42% and PSU down by 0.32% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 3.01%, Hero MotoCorp up by 1.84%, Maruti Suzuki up by 0.38%, Mahindra & Mahindra up by 0.32% and Lupin up by 0.29%. On the flip side, Axis Bank down by 6.91%, ICICI Bank down by 2.30%, Adani Ports &Special down by 1.79%, Asian Paints down by 1.64% and Tata Motors down by 1.60% were the top losers.

Meanwhile, Economic Affairs Secretary Shaktikanta Das has raised his hopes that the Bankruptcy and Insolvency law is expected to become operational by the end of this year, leading to further ease of doing business. He said that the government has a definite roadmap to implement the Bankruptcy law and the Ministry of Corporate Affairs is working on it. The law ministry, the legislative department is also working on finalizing the regulation. Therefore they expect the entire bankruptcy and insolvency law to become operational by end of December.

The government has already set up Insolvency and Bankruptcy Board of India (IBBI) and floated draft norms to take views of the stakeholders. The views of stakeholders have been sought till October 31 on these draft norms. The board will have 10 members and apart from the chairman, currently there are four government-nominated members and the rest are expected to be appointed in coming months. The ministry had issued draft regulations pertaining to registration of insolvency professionals, agencies and model bye-laws. A working group of experts, set up by the ministry, has prepared these regulations.

The Economic Affairs Secretary said that their expectation is that the Bankruptcy Law together with the GST will really bring a lot of dynamism and efficiency to the Indian economy. He added that the GST will happen, Bankruptcy Law has happened and both these pieces of legislation together with amendments to the Arbitration Law, SARFESAI, DRT related laws and the Company Law, have the potential of creating a very vibrant and dynamic economy in India. As per the government notification, the Insolvency and Bankruptcy Code seeks to consolidate and amend laws relating to reorganization as well as insolvency resolution of corporate persons, partnership firms and individuals in a time-bound manner.

The CNX Nifty is currently trading at 8632.50, down by 58.80 points or 0.68% after trading in a range of 8617.90 and 8657.30. There were 14 stocks advancing against 35 stocks declining on the index, 2 stocks remained unchanged.

The top gainers on Nifty were Bharti Airtel up by 2.84%, Hero MotoCorp up by 1.86%, Kotak Mahindra Bank up by 1.45%, Idea Cellular up by 0.93% and Zee Entertainment up by 0.71%. On the flip side, Axis Bank down by 6.96%, ICICI Bank down by 2.45%, Tata Motors - DVR down by 2.11%, Adani Ports &Special down by 2.08% and Tata Motors down by 1.87% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 162.42 points or 0.69% to 23,402.69, KOSPI Index declined 33.82 points or 1.66% to 2,003.35, Taiwan Weighted dipped 22.5 points or 0.24% to 9,363.15, Shanghai Composite shed 11 points or 0.35% to 3,120.93, Jakarta Composite slipped 5.82 points or 0.11% to 5,392.00 and FTSE Bursa Malaysia KLCI was down by 3.27 points or 0.19% to 1,674.16. On the flip side, Nikkei 225 was up by 20.49 points or 0.12% to 17,385.74.