Sensex, Nifty trade in red in late morning session

Indian equity benchmarks erased their gains and started trading below neutral line in late morning session on account of selling in frontline blue chip counters. Investors took cautious approach ahead of US President Donald Trump’s first speech in US Congress scheduled on Tuesday. The sentiments remained under pressure with the economic think-tank National Council of Applied Economic Research (NCAER) lowering the country’s growth forecast to 6.9 percent for the current fiscal on account of demonetization. A few days before demonetization was announced, NCAER had projected a growth rate of 7.6 percent for 2016-17. According to NCAER, the growth rate would rebound to 7.3 percent for 2017-18. The Gross Value Added (GVA) at Basic Prices at constant (2011-12) prices is predicted to grow at 6.3 percent in 2016-17 and 7 percent in 2017-18. Separately, the second official estimate of GDP growth due on Tuesday is likely to show the economy expanded below 7% in FY17, tripped by the November 8 demonetization that dented the consumption demand. The Central Statistics Office’s first estimate released on January 6 pegged growth at 7.1% in FY17, but it did not include the impact of demonetization. Traders were seen piling position in Energy, Oil & Gas and IT stocks, while selling was witnessed in Telecom, Bankex and Auto sector stocks. In scrip specific development, Eveready Industries was trading in green on commencing commercial production at its new plant in Assam. The Goalpara, Assam plant will have a capacity of 500 million pieces of batteries and nine million LED flashlights. Gujarat Apollo Industries was trading in green on reporting net profit of Rs 0.65 crore for the quarter ended December 31, 2016 against net loss of Rs 0.86 crore in the same period last year.

On the global front, Asian shares were trading mostly in red, with Japan’s Nikkei share average fell to 2-1/2 week lows as the yen strengthened and as financial stocks dropped on lower US yields. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 8,950 and 28,900 levels respectively. The market breadth on BSE was positive in the ratio of 1198:1044, while 155 scrips remained unchanged.

The BSE Sensex is currently trading at 28873.71, down by 19.26 points or 0.07% after trading in a range of 28812.88 and 28961.83. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.03%, while Small cap index was up by 0.24%.

The top gaining sectoral indices on the BSE were Energy up by 2.19%, Oil & Gas up by 1.06%, IT up by 0.46%, Consumer Durables up by 0.12% and TECK up by 0.06%, while Telecom down by 1.39%, Bankex down by 0.99%, Auto down by 0.70%, Power down by 0.44% and PSU down by 0.39% were the losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 5.28%, Hindustan Unilever up by 1.24%, Infosys up by 0.72%, Bajaj Auto up by 0.67% and GAIL India up by 0.63%.

On the flip side, Axis Bank down by 2.78%, Mahindra & Mahindra down by 2.10%, Power Grid down by 1.61%, Bharti Airtel down by 1.38% and Dr. Reddy’s Lab down by 1.16% were the top losers.

Meanwhile, in an attempt to make the country a cashless economy, Prime Minister Narendra Modi has said that digital payments will help to check black money and play a crucial role in fighting graft. He also said that people, especially the youth, should become ambassadors of digital payment schemes rolled out by the government.

Observing people slowly shedding their hard currency mindset and moving towards digital currency, Narendra Modi said that the youth are leading the way, using their mobile phones as the new tool to make and receive payments. He also emphasized the need for more scientists to harness technology for the benefit of the common man, while hailing the scientific community for the record launch of 104 satellites and the successful test-firing of a new missile.

Modi said that in the last two months, 10 lakh people have been rewarded, over 50,000 traders have won prizes and an amount of over Rs 150 crore has been earned as prize money by people who have promoted and carried forward the digital payment campaign.

The CNX Nifty is currently trading at 8918.25, down by 21.25 points or 0.24% after trading in a range of 8913.65 and 8951.80. There were 12 stocks advancing against 39 stocks declining on the index.

The top gainers on Nifty were Reliance Industries up by 5.35%, Hindustan Unilever up by 1.23%, Aurobindo Pharma up by 0.86%, Infosys up by 0.69% and Bajaj Auto up by 0.60%.

On the flip side, Axis Bank down by 2.93%, Zee Entertainment down by 2.75%, Ambuja Cement down by 2.03%, Bharti Infratel down by 2.01% and Idea Cellular down by 1.96% were the top losers.

The Asian markets were trading mostly in red; Nikkei 225 decreased 160.3 points or 0.83% to 19,123.24, Jakarta Composite decreased 12.07 points or 0.22% to 5,373.84, Shanghai Composite decreased 8.36 points or 0.26% to 3,245.08 and KOSPI Index decreased 5.48 points or 0.26% to 2,088.64.

On the other hand, Hang Seng increased 3.64 points or 0.02% to 23,969.34 and FTSE Bursa Malaysia KLCI increased 3.68 points or 0.22% to 1,702.03.

Taiwan Stock Exchange remained closed on account of trading holiday.