Benchmarks continue to trade under pressure

Indian equity benchmarks continued their weak trade in the afternoon session on account of sustained selling by funds and retail investors in the blue chip counters, amid weak cues from the global markets. Investor maintained a cautious approach ahead of the key macro data of IIP and CPI inflation slated to be announced after the market hours. Market failed to draw any support with Niti Aayog vice-chairman Arvind Panagariya’s statement that the Goods and Services Tax (GST) regime should be implemented as scheduled despite all challenges as progress will take place only after we move ahead in this regard. Meanwhile, rupee shed 14 paise to 64.64 against the US dollar following fresh demand for the American currency from banks and importers. In scrip specific development, Berger Paints India was up by over four percent on entering into a Memorandum of Understanding (MoU) with Chugoku Marine Paints (CMP) of Japan for cooperation and collaboration in the field of marine and related industrial paints in India.

On the global front, Asian markets were trading mostly in red, as tensions continue to ratchet up on the Korean Peninsula following a warning from North Korea of a nuclear attack on the U.S. Back home, the BSE Sensex is currently trading at 29645.33, down by 143.02 points or 0.48% after trading in a range of 29549.74 and 29838.82. There were 6 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.17%, while Small cap index was down by 0.47%.

The top losing sectoral indices on the BSE were Consumer Durables down by 1.11%, Realty down by 1.10%, Utilities down by 1.07%, Power down by 0.89% and Industrials down by 0.70%, while there were no gainers.

The top gainers on the Sensex were Hero MotoCorp up by 0.52%, HDFC Bank up by 0.41%, Asian Paints up by 0.30%, Coal India up by 0.21% and Bajaj Auto up by 0.06%. On the flip side, Tata Steel down by 1.49%, Maruti Suzuki down by 1.37%, Tata Motors down by 1.36%, GAIL India down by 1.27% and NTPC down by 1.11% were the top losers.

Meanwhile, asserting government’s continued support to public sector banks (PSBs), Finance Minister Arun Jaitley has said that the Indradhanush plan which envisages Rs 70,000 crore being given from the central budget is not the last step as far as recapitalisation is concerned and the government will fully support the public sector banks, since they have a very important role to play in supporting a large number of social programmes and extending the reach of banking and supporting infrastructure in the country.

Jaitley said the government has carried out the exercise of capitalisation of PSBs to conform with regulatory capital norms as well as for driving credit growth to cater to the needs of a growing economy. As part of Indradhanush scheme, the government has decided to infuse Rs 70,000 crore from budgetary resources. The second tranche of capital that is Rs 1.10 lakh crore would come from the central government policy that equity of public sector banks could be brought down, but certainly kept at a minimum level of 52 per cent.

The finance minister while talking about the growing non-performing assets (NPAs) in the PSBs said that the problem of NPAs was due to some people not paying up the banks for the loans taken and the burden coming on to the taxpayer. These 20 to 30 large accountholders will have to realise that banks have to be repaid. If the current promoters are not in a position to repay back, then they have to develop alternate corporate strategies so that the companies pay back. He further said that once the market conditions with regard to the valuation of these banks improves, then the bank shares itself will be used for their further capitalisation.

The CNX Nifty is currently trading at 9194.45, down by 42.55 points or 0.46% after trading in a range of 9161.80 and 9246.40. There were 13 stocks advancing against 38 stocks declining on the index.

The top gainers on Nifty were Eicher Motors up by 1.94%, Ambuja Cement up by 1.25%, Bharti Infratel up by 1.15%, Hero MotoCorp up by 0.49% and Yes Bank up by 0.47%. On the flip side, Zee Entertainment down by 1.83%, Hindalco down by 1.78%, Maruti Suzuki down by 1.55%, Tech Mahindra down by 1.52% and Tata Steel down by 1.49% were the top losers.

The Asian markets were trading mostly in red; Nikkei 225 decreased 195.26 points or 1.04% to 18,552.61, Hang Seng dipped 19.36 points or 0.08% to 24,069.10, Taiwan Weighted was down by 14.74 points or 0.15% to 9,817.68 and Shanghai Composite declined 11.77 points or 0.36% to 3,277.19.

On the flip side, FTSE Bursa Malaysia KLCI increased 2.19 points or 0.13% to 1,738.03, KOSPI Index rose 5.06 points or 0.24% to 2,128.91 and Jakarta Composite was up by 17.94 points or 0.32% to 5,645.87.