Indian bourses enlarge losses; Realty, PSU drag

Key benchmark indices enlarged losses to continue weak trade in the afternoon session on account of selling in frontline counters despite positive global cues. The sentiments remained down-beat with the report indicating that Industrial production contracted in December 2016 due to a sharp decline in production of consumer goods, confirming a demonetisation led contraction in demand. Index of Industrial Production (IIP) was 0.4% lower in December 2016 from the same period a year ago. The number was well below the 5.7% growth in November. Traders were taking cautious bet ahead of January inflation data (CPI) scheduled to be released later in the day. Besides, depreciation in Indian rupee against the dollar too dampened the mood. However, traders took some support with report that the Government’s revenue collection during April-January FY17 showed healthy growth. Indirect tax collection jumped 23.9 percent to Rs 7.03 lakh crore on the back of robust central excise mop-up, while direct tax collection rose by 10.79 percent to Rs 5.82 lakh crore.  In scrip specific development, Hindustan Motors was up by around eleven percent after executing an agreement with Peugeot S.A. for the sale of Ambassador brand (including the trademarks) for a consideration of Rs 80 crore.

On the global front, Asian markets were trading in green, as recent actions by President Donald Trump helped soothe investor worries about ties between the U.S. and its key Asian trading partners. Back home, at present, both Sensex and Nifty were trading below the crucial 28,250 and 8,800 levels, respectively. The BSE Sensex is currently trading at 28248.79, down by 85.46 points or 0.30% after trading in a range of 28238.64 and 28458.80. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.84%, while Small cap index was down by 0.86%.

The top gaining sectoral indices on the BSE were IT up by 0.51% and TECK up by 0.30%, while Realty down by 1.61%, PSU down by 1.34%, Consumer Durables down by 1.02%, Capital Goods down by 1.00% and Oil & Gas down by 0.72% were the losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 1.08%, Infosys up by 0.98%, Tata Steel up by 0.95%, Hindustan Unilever up by 0.89% and Wipro up by 0.75%. On the flip side, SBI down by 1.79%, Coal India down by 1.72%, Maruti Suzuki down by 1.22%, ONGC down by 1.16% and ITC down by 1.12% were the top losers.

Meanwhile, after announcing  introduction of electoral bonds in his Budget speech to ensure greater transparency in political funding, Finance Minister Arun Jaitley has said that government will introduce framework on electoral bonds scheme after detailed discussions with the Reserve Bank of India (RBI) and other stakeholder and minor details about scheme will also come out after discussion. Finance Minister further said that Issuance of electoral bonds would ensure that only legitimate, tax paid, accounted money comes into the political system.

After proposing amendment to the RBI Act in Union Budget 2017-18 to enable issuance of electoral bonds, the government will also amend the Representation of People Act to ensure secrecy of the electoral bond buyers and guidelines for the same will come out by March. Jaitley said that the government will discuss with RBI to finalise the issues such as the duration of the Electoral Bonds, and the bank branches that will be involved for the scheme.

Electoral Bond is a financial instrument for making donations to political parties which will resemble a promissory note and not an interest-paying debt instrument, will be sold by authorised banks and can be deposited in notified accounts of political parties within the duration of their validity. So, every political party recognised by the Election Commission will have to notify one account in advance to the Election Commission and bonds can be encashed and redeemed in that one account.

The CNX Nifty is currently trading at 8770.25, down by 23.30 points or 0.26% after trading in a range of 8764.45 and 8826.90. There were 19 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 1.84%, Eicher Motors up by 1.74%, Kotak Mahindra Bank up by 1.26%, Yes Bank up by 1.19% and Power Grid up by 1.05%. On the flip side, Bank of Baroda down by 9.07%, Idea Cellular down by 3.17%, Aurobindo Pharma down by 2.80%, BHEL down by 2.59% and Coal India down by 1.79% were the top losers.

The Asian markets were trading in green; KOSPI Index increased 3.57 points or 0.17% to 2,078.65, FTSE Bursa Malaysia KLCI gained 8.3 points or 0.49% to 1,707.24, Shanghai Composite was up by 13.78 points or 0.43% to 3,210.48, Jakarta Composite rose 34.37 points or 0.64% to 5,406.04, Taiwan Weighted added 44.73 points or 0.46% to 9,710.32, Nikkei 225 surged 80.22 points or 0.41% to 19,459.15 and Hang Seng was up by 95.89 points or 0.41% to 23,670.87.