Weakness persist, benchmarks continue to trade below record high

Indian markets are making some effort of recovery towards the mid of the day, however there is not much positive trigger that could support the markets higher and the benchmarks slipping below the record levels achieved last session, were down by over half a percent. The global cues continued weighing down the sentiments with most of the Asian peers trading in red led by the Japanese market which is down by over a percent since morning on concerns over US President Donald Trump’s administration, threatening to derail the policy agenda that helped push global equities to records. Back home, the traders were eyeing the two-day GST Council meet beginning today in Srinagar, which will see participation from 29 states and union territories, along with Jaitley, and senior officials from the revenue department. In the meeting Finance Ministry Arun Jaitley is likely to finalise the rates that various goods and services will attract from July 1. Traders seems to have overlooked a senior UN economic official’s statement that the demonetisation policy is not expected to have a long term impact on domestic demand in India, which is projected to clock a 7.9 percent growth in fiscal 2018.

On the sectoral front, IT and tech stocks were the ones holding their gains since morning, while the drag was mainly coming from the realty and capital goods sector stocks. Meanwhile, shares of IRB infrastructure investment trust (IRB InvIT), India's first infrastructure investment trust got listed on the exchanges today and the shares rose as much as 3 per cent to Rs. 105 against its issue price of Rs. 102.

The BSE Sensex is currently trading at 30552.15, down by 106.62 points or 0.35% after trading in a range of 30436.56 and 30567.82. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were in rather worse situation than their larger peers; the BSE Mid cap index was down by 1.12%, while Small cap index was down by 0.95%.

The two gaining sectoral indices on the BSE were IT up by 2.16% and TECK up by 1.53%, while Realty down by 1.81%, Capital Goods down by 1.51%, Basic Materials down by 1.43%, Industrials down by 1.42%, Metal down by 1.32% were the top losing indices on BSE.

The top gainers on the Sensex were Wipro up by 3.99%, TCS up by 3.88%, Infosys up by 1.55%, Lupin up by 1.23% and Cipla up by 0.91%. On the flip side, Larsen & Toubro down by 1.86%, Axis Bank down by 1.63%, Tata Motors down by 1.59%, Dr. Reddys Lab down by 1.39% and ITC down by 1.24% were the top losers.

Meanwhile, in a bid to attract higher foreign investments in the country, the government is mulling easing foreign direct investment (FDI) policy on construction, print media and retail sectors, which will provide investor friendly climate to foreign players and in turn boost economic growth & create jobs. In this regard the commerce and industry ministry may approach the Cabinet soon to get the final approval on these proposals.

In print media the government is considering to relax FDI norms in certain areas, currently government allows foreign investment in areas such as printing of newspapers and publishing of scientific magazines with certain conditions and FDI caps. In construction and development sector, proposal is to ease the policy, under which an Indian company could be allowed to bring FDI even for undeveloped plots in any project. Currently, 100 percent FDI is allowed in the construction sector subject to various conditions. The government is also mulling easing policy in single brand and multi-brand retail trading and there are consideration to allow 100 percent FDI in single brand retail sector through automatic route with certain conditions.

Foreign investments are considered crucial for economic development of the country and to attract maximum FDI into the country, the government has been relaxing the foreign investment norms in various sectors. Foreign investments will help improve the country's balance of payments situation and strengthen the rupee value against other global currencies, especially the dollar and India needs around $1 trillion to overhaul its infrastructure sector such as ports, airports and highways to boost growth.

The CNX Nifty is currently trading at 9472.95, down by 52.80 points or 0.55% after trading in a range of 9445.25 and 9489.10. There were 11 stocks advancing against 40 stocks declining on the index.

The top gainers on Nifty were TCS up by 3.79%, Wipro up by 3.07%, Infosys up by 1.57%, HCL Tech. up by 1.56% and Lupin up by 1.18%. On the flip side, Hindalco down by 2.54%, Bharti Infratel down by 2.35%, Ultratech Cement down by 2.18%, Yes Bank down by 1.96% and Eicher Motors down by 1.84% were the top losers.

All the Asian markets barring the Jakarta Composite which was up by 13.45 points or 0.24% to 5,628.94, were trading in red.

Nikkei 225 slumped by 268.55 points or 1.36% to 19,546.33, Hang Seng declined by 78.53 points or 0.31% to 25,215.10, Taiwan Weighted was lower by 44.22 points or 0.44% to 9,969.45, Shanghai Composite decreased by13.77 points or 0.44% to 3,090.68, FTSE Bursa Malaysia KLCI was down by 9.64 points or 0.54% to 1,766.01 and KOSPI Index lost 6.27 points or 0.27% to 2,286.81.