Weak trade persists; Nifty slips below 8,900 level

In the afternoon deals, Indian equity indices continued their lackluster trade in absence of any positive trigger, which could lift the markets higher, amid prevailing caution ahead of the expiry of February equity derivatives on Thursday. Markets also cautiously awaited the opening of European markets for further direction. Both the Sensex and Nifty were trading below their crucial 28,650 and 8,900 levels respectively, as Telecom, TECK and IT stocks came under heavy selling pressure. Though, the broader indices remained positive on account of some low level buying in selected mid cap and small cap stocks. Sentiments remained dampened with ICRA’s report stating that Indian gross value added (GVA) at basic prices to ease to 6.2 percent in Q3FY17 from 6.9 percent in Q3 FY16 and Gross Domestic Product (GDP) growth likely to decline to 6.5 percent from 7.2 percent a year ago.

On the global front, Asian markets were mostly in green on Tuesday, as investors looked ahead to minutes from the U.S. Federal Reserve's latest meeting and Wall Street prepared to reopen after a three-day weekend. Back home, in scrip specific development, Siemens was trading in green after the company with Siemens Rail Automation S.A.U Spain won an order worth Rs 287 crore, out of which Siemens' share is Rs 146 crore.

The BSE Sensex is currently trading at 28618.99, down by 42.59 points or 0.15% after trading in a range of 28597.33 and 28726.10. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.42%, while Small cap index was up by 0.47%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.15%, Industrials up by 0.57%, Oil & Gas up by 0.55%, Basic Materials up by 0.53%, PSU up by 0.52%, while Telecom down by 1.26%, TECK down by 0.50%, IT down by 0.31%, FMCG down by 0.26%, Utilities down by 0.15% were the losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 2.12%, Asian Paints up by 1.03%, Hindustan Unilever up by 0.84%, Tata Motors up by 0.79% and Tata Steel up by 0.67%. On the flip side, Bharti Airtel down by 2.10%, ITC down by 1.20%, TCS down by 1.20%, Sun Pharma down by 0.77% and Coal India down by 0.70% were the top losers.

Meanwhile, in an attempt to verify large cash deposits made during the demonetisation period, the income tax (I-T) department is expected to launch the second phase of ‘Operation Clean Money’ next month to close in on unaccounted money making its way into banks but may ignore deposits below Rs 5 lakh on a standalone basis for the time being. The initiative will also try to link individuals with multiple accounts or PAN numbers who have deposited large sums of money.

Under Operation Clean Money initiative, government will appoint two data analytics firms in next 10 days. These firms will tally the post demonetisation deposit data with the Income Tax Returns (ITRs) and previous deposits to detect any anomaly and possible tax evasion. Deposits of above Rs 2 lakh totalling Rs 10 lakh crore were made post-demonetisation. Out of this, Rs 4.5 lakh crore is under verification and the remaining deposits were made by government agencies and departments like PSUs, or by such people whose deposits matched with the income and the pattern of deposits made earlier and so these are not under scrutiny.

At present, the I-T Department has begun analysing accounts which show a pattern of deposits or have some common linkage like common address, PAN, telephone number, email address or name and in the first phase of this initiative, the department sent SMS/emails to 18 lakh people who made suspicious deposits over Rs 5 lakh during the 50-day demonetisation period and over 7 lakh people replied in e-filing portal acknowledging that they have made such deposits.

The CNX Nifty is currently trading at 8867.55, down by 11.65 points or 0.13% after trading in a range of 8861.65 and 8897.15. There were 28 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Axis Bank up by 1.86%, Tech Mahindra up by 1.35%, Grasim Industries up by 1.26%, Yes Bank up by 1.08% and Asian Paints up by 1.00%. On the flip side, Bharti Infratel down by 3.69%, Bharti Airtel down by 2.05%, ITC down by 1.37%, Zee Entertainment down by 1.25% and TCS down by 1.11% were the top losers.

Asian markets were trading mostly in green; Shanghai Composite increased 9.71 points or 0.3% to 3,249.67, Taiwan Weighted advanced 10.73 points or 0.11% to 9,763.93, Jakarta Composite jumped 12.47 points or 0.23% to 5,371.75, KOSPI Index surged 18.54 points or 0.89% to 2,102.93 and Nikkei 225 was up by 130.36 points or 0.68% to 19,381.44. On the other hand, Hang Seng decreased 136.26 points or 0.56% to 24,009.82 and FTSE Bursa Malaysia KLCI was down by 3.06 points or 0.18% to 1,709.52.