Markets continue to trade in red in late afternoon session

Indian benchmark indices continued to trade in red in late afternoon session as investors remained on sidelines ahead of the Reserve Bank of India's policy meeting next week. Sentiments remained pessimistic with report that India's services languished, with new business orders falling for the third straight month, amid muted inflationary pressure that could offer RBI much room to remain accommodative in its next policy meet next week, says a monthly survey. The Nikkei India Services Purchasing Managers' Index (PMI), which tracks services sector companies on a monthly basis, came in at 48.7 in January, from 46.8 in December 2016. A reading above 50 indicates expansion, while any score below the mark denotes contraction. However, losses remained limited with Prime Minister Narendra Modi’s statement that Budget 2017-18 aims at giving wings to 125 crore Indians and fulfilling their development aspirations. The aim is all-round and all-inclusive growth, impacting every section of the society positively.

On global front, European markets were trading in green as investors digest U.S. President Donald Trump's latest comments about the North American Free Trade Agreement, a recent ballistic missile test by Iran and the Australia refugee deal. Asian markets were trading in green. Back home, in scrip specific development, SREI Infrastructure Finance was trading in green after the company posted over two-fold jump in its net profit at Rs 26.24 crore for the quarter ended December 31, 2016, as compared to Rs 11.88 crore for the same quarter in the previous year.

The BSE Sensex is currently trading at 28180.19, down by 46.42 points or 0.16% after trading in a range of 28127.18 and 28280.58. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.64%, while Small cap index was up by 0.93%.

The top gaining sectoral indices on the BSE were Realty up by 1.24%, TECK up by 0.58%, PSU up by 0.57%, Bankex up by 0.43% and IT up by 0.40%, while Metal down by 0.97%, Auto down by 0.80%, Consumer Durables down by 0.68%, FMCG down by 0.31% and Oil & Gas down by 0.23% were the top losing indices on BSE.

The top gainers on the Sensex were Cipla up by 4.46%, Dr. Reddy’s Lab up by 1.69%, Axis Bank up by 1.40%, TCS up by 1.23% and SBI up by 1.19%. On the flip side, Tata Motors down by 1.58%, Tata Steel down by 1.55%, ICICI Bank down by 1.44%, GAIL India down by 0.97% and Larsen & Toubro down by 0.90% were the top losers.

Meanwhile, contracting for third straight month, India's services industry growth softened in the first month of 2017, with the slowdown in new business inflows, as firms struggled to recover from Prime Minister Narendra Modi's shock currency crackdown. The seasonally adjusted headline Nikkei India Services Business Activity Index remained below the 50 mark that separates growth from contraction, stood at 48.7 in January from 46.8 in December. As per the report, headcounts rose marginally, while work-in-hand increased for the eighth successive month. Input cost inflation slowed since December to a pace that was only marginal, whereas average selling prices decreased again.

The seasonally adjusted Nikkei India Composite PMI Output Index rose to 49.4 in January from December’s 38-month low of 47.6, pointing to a weaker contraction in private sector activity that was only marginal. The slowdown was supported by a rebound in factory production. According to the report, new orders at services firms dipped at a softer rate in January. Almost 11% of survey panelists reported falling levels of incoming new business, which they commonly associated with a relatively lower amount of cash in circulation. Concurrently, factory orders rose in the latest month.

Also, January data highlighted an increasing degree of pressure on the capacity of private sector firms’ operations as outstanding business rose to a greater extent than in December. However, sentiment among services companies improved considerably during January on the back of expectations that market conditions will soon normalize. Among the survey respondents, exactly 17% of panelists anticipate higher activity levels at their units in the coming 12 months, while the remaining firms foresee no change.

The CNX Nifty is currently trading at 8721.10, down by 13.15 points or 0.15% after trading in a range of 8707.75 and 8748.25. There were 24 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were Cipla up by 4.60%, Tech Mahindra up by 3.39%, Bank of Baroda up by 3.10%, Bharti Infratel up by 2.70% and Dr. Reddy’s Lab up by 1.60%. On the flip side, Zee Entertainment down by 2.75%, Bosch down by 2.17%, Tata Steel down by 1.77%, Hindalco down by 1.71% and Tata Motors down by 1.70% were the top losers.

The Asian markets were trading mostly in green; KOSPI Index increased 2.15 points or 0.1% to 2,073.16, Nikkei 225 increased 3.62 points or 0.02% to 18,918.20, FTSE Bursa Malaysia KLCI increased 9.13 points or 0.55% to 1,682.61, Jakarta Composite increased 9.45 points or 0.18% to 5,363.16 and Taiwan Weighted increased 26.59 points or 0.28% to 9,455.56. On the flip side, Hang Seng decreased 55.31 points or 0.24% to 23,129.21 and Shanghai Composite decreased 19 points or 0.6% to 3,140.17.

All the European markets were trading in green; Germany’s DAX increased 9.46 points or 0.08% to 11,637.41, UK’s FTSE 100 increased 11.61 points or 0.16% to 7,152.36 and France’s CAC increased 23.53 points or 0.49% to 4,817.82.