Benchmarks trade flat ahead of exit polls

Indian equity benchmarks continued their lackluster trade on a flat note in late morning session as traders’ maintained cautious approach ahead of key exit poll data for assembly elections in five states that will be announced later in the day. The rupee opened down against dollar on account of buying of American currency by banks and importers amid a stronger-than-expected US private-sector jobs figures in February sealed expectations that the Federal Reserve will raise interest rates next week. While the global scenario is looking up, certain hurdles like the upcoming elections in France in next 2-3 months will be in focus. Back home, investors took note that government is in talks with 300 companies to attract investment. The government and its investment promotion agency, Invest India, are in talks with close to 300 companies - both Indian and foreign -to channelize investment of close to $62 billion (over Rs 4 lakh crore) into the country, which may help create over 17 lakh jobs. Traders were seen piling position in Realty, Consumer Durables and Auto stocks, while selling was witnessed in Utilities, Healthcare and Power sector stocks. In scrip specific development, Dr. Reddy’s Laboratories was trading under pressure after the US Food and Drug Administration (FDA) made 13 observations relating to deviation from good manufacturing practices (GMP) at the company’s cancer formulations facility at Duvvada in Visakhapatnam. Tata Teleservices (Maharashtra) was trading in red after the Reserve Bank of India (RBI) opposed its settlement deal with DoCoMo in the Delhi High Court. The central bank opposed the consent terms filed by Tata Sons and NTT DoCoMo in their long-standing dispute.

On the global front, Asian shares were trading mostly in red, with regional sentiment driven by inflation figures from China which showed consumer prices under control, but producer prices up sharply. Consumer prices in China fell to the lowest in two years at an annual pace of 0.8%, which compared to a gain of 1.7% expected as food prices dropped, and eased pressure after a 2.5% gain in January. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 8,950 and 29,000 levels respectively. The market breadth on BSE was positive in the ratio of 1148:1029, while 143 scrips remained unchanged.

The BSE Sensex is currently trading at 28905.77, up by 3.83 points or 0.01% after trading in a range of 28815.02 and 28928.85. 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 0.08%, while Small cap index was up by 0.20%.

The top gaining sectoral indices on the BSE were Realty up by 0.73%, Consumer Durables up by 0.54%, Auto up by 0.44%, Consumer Disc up by 0.39% and Basic Materials up by 0.15%, while Utilities down by 0.43%, Healthcare down by 0.40%, Power down by 0.33%, Oil & Gas down by 0.32% and Energy down by 0.31% were the losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 1.17%, Maruti Suzuki up by 1.01%, Axis Bank up by 1.00%, HDFC up by 0.86% and SBI up by 0.83%.

On the flip side, Dr. Reddy’s Lab down by 3.97%, GAIL India down by 1.54%, Adani Ports & Special Economic Zone down by 1.39%, ONGC down by 1.01% and Wipro down by 0.94% were the top losers.

Meanwhile, after the H-1B visa fiasco, India is going to face troubles on the trade and investment fronts, too from the US. As per the 2017 Trade Policy Agenda unveiled by the Trump administration, the US will come down on India’s export subsidy programmes, and push for a stricter regime for intellectual property rights and patents.

The 2017 Trade Policy Agenda and 2016 Annual Report of the President of the United States on the Trade Agreements Program - released by the Office of the United States Trade Representative categorically said that India’s “import restricting measures” result in “serious market access issues” for the US industry. The document sees a general trend of tariff increases in India, which reflects an active pursuit of import substitution policies.

The United States raised strong concerns regarding India’s decision to impose import tariffs on certain telecommunication products covered under the Information Technology Agreement (ITA), as well as India’s tariff increases in a number of sectors that impact U.S. exports to India. It said that the United States will continue to seek to engage India bilaterally to commit to a phase-out of its export subsidy programs to the extent that they benefit the textile and apparel sector.

The report however also stated that India’s trade and regulatory policies have “inhibited” the real growth potential of the bilateral trade that rose to $109 billion in 2015 from $4.8 billion in 1980. The Goods and Services Tax (GST) regime, it says, could provide an impetus to the creation of a “common internal market that significantly lowers transaction costs.”

The CNX Nifty is currently trading at 8919.70, down by 4.60 points or 0.05% after trading in a range of 8899.50 and 8929.80. There were 24 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were Asian Paints up by 1.20%, Axis Bank up by 1.05%, Maruti Suzuki up by 1.01%, ACC up by 0.94% and HDFC up by 0.82%.

On the flip side, Dr. Reddy’s Lab down by 3.98%, Idea Cellular down by 2.02%, GAIL India down by 1.98%, Adani Ports & Special Economic Zone down by 1.45% and Wipro down by 1.21% were the top losers.

The Asian markets were trading mostly in red; Hang Seng decreased 251.87 points or 1.06% to 23,530.40, Taiwan Weighted decreased 85.22 points or 0.87% to 9,668.23, Shanghai Composite decreased 29.58 points or 0.91% to 3,211.08, FTSE Bursa Malaysia KLCI decreased 2.88 points or 0.17% to 1,722.66, KOSPI Index decreased 2.53 points or 0.12% to 2,092.88 and Jakarta Composite decreased 0.38 points or 0.01% to 5,393.38.

On the other hand, Nikkei 225 increased 56.68 points or 0.29% to 19,310.71.