Benchmarks extend losses; trades near intra-day low

Indian bourses increased losses to continue weak trade in the afternoon session, hovering near the lowest point of the day due to selling in frontline blue chip stocks such as Bajaj Auto, SBI and ICICI Bank among other. Sentiments remained down-beat after global financial services major Nomura revised upwards India's current account deficit (CAD) forecast to 1.4% of GDP for the current fiscal from 0.4% earlier. According to Nomura, India's trade deficit widened to a 16-month high of $13 billion in November from $10.4 billion in October, as a result of a sharp slowdown in exports after demonetization and a pickup in imports, led by gold and higher commodity prices. For the fourth quarter (October-December) of 2016 Nomura expects a current account deficit of 2.5% of GDP (versus 0.9% earlier) and for the January-March period, it is likely to be around 2% of GDP. Besides, depreciation in Indian rupee against the dollar too weighed down sentiments. Indian rupee was trading lower by 5 paise at 67.91 against the dollar at this point of time on sustained foreign fund outflows amid increased demand for the US currency from importers. Market failed to draw any support with NITI Aayog member Ramesh Chand’s statement that despite the impact of demonetisation, growth in agriculture for the current year will still be above 5 per cent, though he pointed that the prevailing cash crunch has hit the growers of perishables more compared to those who grow bulk crops such as paddy and cotton.

On the global front, Asian markets were trading mostly in red as terror attacks in Turkey, Switzerland and Germany spurred demand for safe-haven assets and the dollar strengthened after upbeat comments from Federal Reserve Chair Janet Yellen. Back home, in scrip specific development, Gujarat Industries Power Company rose over two percent after the company signed power purchase agreements (PPA) for a period of twenty five years with Gujarat Urja Vikas Nigam (GUVNL) for the entire 26 megawatts (MW) wind farm capacity of the Rojmal Wind Farm. 

The BSE Sensex is currently trading at 26285.14, down by 89.56 points or 0.34% after trading in a range of 26266.40 and 26435.56. 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 1.05%, while Small cap index was down by 0.66%.

The top gaining sectoral indices on the BSE were IT up by 1.13%, TECK up by 0.86%, Consumer Durables up by 0.24%, FMCG up by 0.07% and Capital Goods up by 0.03%, while Bankex down by 1.31%, Metal down by 1.22%, PSU down by 0.93%, Auto down by 0.83% and Oil & Gas down by 0.57% were the losing indices on BSE.

The top gainers on the Sensex were TCS up by 2.05%, Infosys up by 1.30%, ITC up by 1.01%, Coal India up by 0.97% and GAIL India up by 0.95%. On the flip side, Bajaj Auto down by 2.58%, SBI down by 2.43%, ICICI Bank down by 2.29%, Tata Steel down by 2.00% and Adani Ports &Special down by 1.57% were the top losers.

Meanwhile, in order to bridge the affordability gap for the persons residing in rural areas and in line with government’s announcement of incentivizing digital payment, the Telecom Regulatory Authority of India (TRAI) has suggested that a reasonable amount of free access to data services around 100MB should be provided to rural subscribers on monthly basis.

TRAI has also suggested that the implementation cost of such schemes may be met from Universal Service Obligation Fund (USOF). Under USOF, the government charges a cess in the form of Universal Access Levy from telecom licencees to fund setting up of telecom infrastructure in all uncovered rural and remote areas of the country.

The telecom regulator has said that to increase participation of other entities for incentivising free data, there is a need to introduce third party, or aggregator, to facilitate schemes that are telecom service operator agnostic. It further said that any scheme for provision of free data must be telecom operator agnostic and must not involve any arrangement between the TSP (telecom service provider) and the aggregator or content provider. It should not be designed to circumvent its regulation on free mobile internet services as mentioned under 'The Prohibition of Discriminatory Tariffs for Data Services Regulations'.

Meanwhile, the regulator has suggested that the aggregator providing this scheme will need to register with Department of Telecom (DoT) and the validity of the registration shall be five years. TRAI in February barred differential pricing on Internet which ended services of platforms like Facebook's Free Basics and Airtel Zero. The regulator in May also released a consultation paper on free data services.

The CNX Nifty is currently trading at 8074.45, down by 29.90 points or 0.37% after trading in a range of 8071.10 and 8124.10. There were 17 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were TCS up by 2.13%, Tech Mahindra up by 1.16%, Coal India up by 1.13%, Ambuja Cement up by 1.12% and ITC up by 1.10%. On the flip side, Idea Cellular down by 2.95%, Aurobindo Pharma down by 2.74%, Bosch down by 2.63%, SBI down by 2.62% and Bank Of Baroda down by 2.60% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 112.78 points or 0.52% to 21,719.90, Shanghai Composite shed 27.14 points or 0.87% to 3,090.94, Jakarta Composite was down by 14.63 points or 0.28% to 5,176.53 and FTSE Bursa Malaysia KLCI declined 0.49 points or 0.03% to 1,633.81. On the flip side, Taiwan Weighted increased 3.09 points or 0.03% to 9,242.41, KOSPI Index rose 3.55 points or 0.17% to 2,041.94 and Nikkei 225 was up by 102.93 points or 0.53% to 19,494.53.