Benchmarks trade near low point of day

Indian equity benchmarks continued their weak trade, hovering near the lowest point of the day in late morning session in absence of sufficient global cues as most of the Asian markets are shut for trade today. Banking stocks were reeling under pressure after Prime Minister Narendra Modi asked banks to prioritize their lending towards the poor and middle class. The banks lowering the lending rate are good for ultimate demand but at the same time, it is going to cause a hit on banks. The rupee opened weaker against dollar on the first day of Calendar 2017 following global cues. Foreign portfolio investors continued to remain net sellers in domestic equity markets on Friday as they sold shares worth a net Rs 585.64 crore on December 30, 2016, as per provisional data released by the stock exchanges. The sentiments were under pressure after industry body, Associated Chambers of Commerce and Industry of India (ASSOCHAM) in its latest report highlighted that banning of high value notes would lower growth rate due to economic slowdown in the third and fourth quarters of fiscal 2016-17. Apex industry body admitted that it was not easy to predict precisely the impact of note withdrawal with far-reaching implications and also said that the growth momentum would be restored by the normal monsoon raising agricultural growth and rural demand. Some pressure also built up after India’s manufacturing PMI (purchase manager’s index) fell in December 2016 as demonetization took its toll on the economy. The headline seasonally adjusted Nikkei India Manufacturing Purchasing Managers’ Index (PMI) recorded below the crucial 50 threshold for the first time in 2016 during December. Down from 52.3 in November to 49.6, the latest reading was indicative of a marginal deterioration in the health of the sector. Nevertheless, the average over the October-December quarter (52.1) was broadly in line with that seen in the July-September period (52.2).

Traders were seen piling position in Realty, Oil & Gas and Capital Goods stocks, while selling was witnessed in Bankex, FMCG and PSU sector stocks. Shares of realty companies like DLF, HDIL, Unitech, Godrej Properties, Omaxe, Sobha Developers and Oberoi Realty were trading firm after Prime Minister Narendra Modi on December 31 announced that loans of up to Rs 9 lakh taken in the new year under the new scheme of Pradhan Mantri Awas Yojana will receive interest subvention of 4% and loan of up to Rs 12 lakh will get a 3% interest waiver. Oil marketing companies like Hindustan Petroleum Corporation (HPCL), Bharat Petroleum Corporation (BPCL) and Indian Oil Corporation (IOC) were trading in green after they increased petrol prices by Rs 1.29 a litre - the third increase in a month, and diesel price by 97 paise a litre - the second hike in a fortnight. Aviation stocks SpiceJet and Jet Airways were trading under pressure after aviation turbine fuel (ATF) prices were hiked by a steep 8.6%. ATF or jet fuel price was hiked by Rs 4,161 per kilolitre (kl), or 8.6%, to Rs 52,540.63 per kl in Delhi.

On the global front, Asian shares were closed on account of trading holiday except South Korean market which was trading in green. China’s outstanding foreign debt rose 3 percent in the third quarter, data from the foreign exchange regulator showed, quickening from a 2.2 percent rise in the second quarter. Overall foreign debt continued a rebound seen in the second quarter, indicating that the deleveraging process in our country's foreign debt is basically over. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 8,150 and 26,500 levels respectively. The market breadth on BSE was positive in the ratio of 1346:736, while 100 scrips remained unchanged.

The BSE Sensex is currently trading at 26473.70, down by 152.76 points or 0.57% after trading in a range of 26472.42 and 26720.98. There were 14 stocks advancing against 16 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.06%, while Small cap index was up by 0.52%.

The top gaining sectoral indices on the BSE were Realty up by 2.61%, Oil & Gas up by 0.62%, Capital Goods up by 0.27%, Metal up by 0.24% and Power up by 0.24%, while Bankex down by 1.33%, FMCG down by 0.55% and PSU down by 0.23% were the losing indices on BSE.

The top gainers on the Sensex were Wipro up by 0.73%, Dr. Reddy’ Lab up by 0.70%, NTPC up by 0.70%, Tata Steel up by 0.69% and Cipla up by 0.51%.

On the flip side, HDFC down by 2.69%, SBI down by 2.38%, Bajaj Auto down by 2.12%, ICICI Bank down by 1.84% and Axis Bank down by 1.23% were the top losers.

Meanwhile, in line with global trends, PSU oil marketing companies (OMCs) have hiked price of petrol and diesel by Rs 1.29 per litre and 97 paise per litre respectively, excluding state levies. Revised prices came into effect from midnight of January 1/2 2017. This is the third hike in petrol price in one month and the second in case of diesel in one fortnight.

Following the revision, petrol now in the National capital will cost Rs 70.60/litre as against Rs 68.94 a litre currently, while diesel price will cost Rs 57.82/litre as compared to Rs 56.68 per litre currently. In the last revision on December 16, the price of petrol was increased by Rs 2.21 a litre and diesel rate was also increased by Rs 1.79 per litre, excluding state levies.

According to IOC the country's largest fuel retailer, the hike in prices is due to the movement of prices in the international oil market and INR-USD exchange rate shall continue to be monitored closely and developing trends of the market will be reflected in future price changes. It further added that the current level of international product prices of petrol and diesel and INR-USD exchange rate warrant increase in selling price of petrol and diesel, the impact of which is being passed on to the consumers with this price revision.

The CNX Nifty is currently trading at 8147.60, down by 38.20 points or 0.47% after trading in a range of 8141.00 and 8212.00. There were 25 stocks advancing against 26 stocks declining on the index.

The top gainers on Nifty were Eicher Motors up by 3.04%, Ultratech Cement up by 2.33%, Ambuja Cement up by 2.08%, ACC up by 1.27% and BHEL up by 1.16%.

On the flip side, HDFC down by 2.66%, SBI down by 2.50%, Bajaj Auto down by 2.06%, Bank of Baroda down by 1.76% and ICICI Bank down by 1.57% were the top losers.

Equity markets in China, Japan, Hong Kong, and Australia are all shut on account of the New Year holiday. The only counter opened today was KOSPI Index, increased 0.51 points or 0.03% to 2,026.97.