Benchmarks continue weak trade in afternoon deals

Indian equity benchmarks continued their lackluster trade in afternoon deals, with selling pressure being witnessed in Telecom, Utilities, Basic Materials and Power sector stocks despite firm Asian cues. Sentiment remained weak with the reports that Foreign Portfolio Investors (FPIs) sold shares worth a net Rs 1,150.45 crore on April 28, 2017. However, downside was capped with the report that Indian manufacturing activity expanded for a fourth consecutive month in April, helped by stronger growth in new orders, although rise in output and employment slowed. Furthermore, recovering from the one-year low growth rate of 1% in February, India’s core sector growth accelerated to 5% in March 2017, on the back of a sustained growth in the steel and coal output, supported by a stable rise in natural gas production. On the sectoral front, Realty stocks such as DLF and Unitech were trading higher after the Real Estate (Regulation Development Act) came into effect from May 1. It is expected that the Act will bring in accountability and transparency.

On the global front, Asian markets were trading mostly in green, helped by rising optimism on the technology industry and easing concerns over North Korea, while the US dollar edged up to one-month high versus the yen. Back home, the BSE Sensex is currently trading at 29865.25, down by 53.15 points or 0.18% after trading in a range of 29804.12 and 30069.24. 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 0.07%, while Small cap index was up by 0.07%.

The top gaining sectoral indices on the BSE were Realty up by 1.79%, Oil & Gas up by 1.00%, Consumer Durables up by 0.98%, PSU up by 0.57% and IT up by 0.52%, while Telecom down by 0.98%, Utilities down by 0.79%, Basic Materials down by 0.74%, Power down by 0.70% and Capital Goods down by 0.62% were the losing indices on BSE.

The top gainers on the Sensex were ONGC up by 3.41%, Maruti Suzuki up by 1.96%, HDFC up by 1.67%, Adani Ports &SEZ up by 1.28% and Hero MotoCorp up by 1.18%. On the flip side, Lupin down by 1.63%, Tata Motors down by 1.62%, Bharti Airtel down by 1.61%, Reliance Industries down by 1.50% and Power Grid down by 1.40% were the top losers.

Meanwhile, after witnessing drop previously due to the note ban, the Business Confidence level has seen a rebound in the Federation of Indian Chambers of Commerce and Industry’s (FICCI) latest Business Confidence Survey, touching an eight-quarter high. 54 per cent of the survey respondents said that the current economic conditions are much better than six months ago. Besides, 79 per cent feel the country’s economy will do even better in the next six months. Though it was found that the impact of demonetisation ebbed at a much faster pace than earlier anticipated, the survey cautioned that the protectionist trends gaining strength in the developed world could have an adverse impact on India’s export performance.

The survey of nearly 185 companies further stated that Indian industry is already grappling with low demand as most companies are not getting the benefit of credit flow at lower rates; around 67 per cent of the participants stated that they are unable to avail the benefit of credit flow at lower rates. On the other 65 per cent of the companies surveyed expect better sales performance during April to September 2017, while 42 per cent expect profits to increase and 40 per cent expect to invest more than their current investments levels. The survey further noted that 27 per cent of the companies plan to hire more number of employees.

As per the survey, 79 per cent of the participating companies expect the economy to do even better in the coming six months, while nearly 54 per cent feel that current economic conditions are moderately to substantially better compared to the previous six months. Moreover, 31 per cent expect the export demand to be better than what it is now.

The CNX Nifty is currently trading at 9292.15, down by 11.90 points or 0.13% after trading in a range of 9269.90 and 9352.55. There were 22 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing up by 3.69%, ONGC up by 3.30%, BPCL up by 2.61%, Maruti Suzuki up by 2.00% and HDFC up by 1.68%. On the flip side, Ambuja Cement down by 3.90%, Tata Motors - DVR down by 2.88%, ACC down by 2.72%, Tata Motors down by 1.85% and Aurobindo Pharma down by 1.78% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 8.15 points or 0.46% to 1,776.21, Jakarta Composite gained 11.03 points or 0.19% to 5,696.33, KOSPI Index rose 14.23 points or 0.65% to 2,219.67, Taiwan Weighted surged 69.27 points or 0.7% to 9,941.27 and Nikkei 225 was up by 135.18 points or 0.7% to 19,445.70.

On the flip side, Shanghai Composite decreased 13.79 points or 0.44% to 3,140.87 and Hang Seng was down by 3.08 points or 0.01% to 24,612.05.