Benchmarks trade in tight band with negative bias

Indian equity indices continued to gyrate in a tight band with a negative bias in the noon session, as investors remained cautious ahead of the Reserve Bank of India’s (RBI) monetary policy review meet tomorrow. Sentiments remained subdued with the report that Indian companies raised around Rs 33,400 crore in May through private placement of corporate bonds, a slump of 44% from the year-ago level, for business expansion and propping up working capital needs. According to latest data available with markets regulator SEBI, firms garnered a total of Rs 33,389 crore in May 2017, lower than Rs 59,801 crore raised in the year-ago period. Besides, weak trend in Asian stocks also weighed on the trading sentiments. However, losses remained capped with the report that India has surpassed China to secure the top position among 30 developing countries on ease of doing business. The 2017 Global Retail Development Index (GRDI), now in its 16th edition, ranks the top 30 developing countries for retail investment worldwide and analyses 25 macroeconomic and retail-specific variables. Meanwhile, the progress of the monsoon continues to be stuck along the Kochi-Tondi-Agartala-Williamnagar-Kokrajhar axis linking the west coast and North-East India but it is a matter of a few days before it resumes its northward journey. Even in Kerala, the rains are yet to reach the northern districts beyond Ernakulam and Thrissur, according to trends in recorded rainfall till Monday.

On the global front, Asian markets were trading mostly lower on Tuesday, following the weak cues overnight from Wall Street and as investors digested the impact of six Arab countries including Saudi Arabia having cut diplomatic ties with Qatar. Crude oil prices extended losses in Asian trades. Investors are also cautious ahead of the UK general election, the ECB meeting and former FBI director James Comey's congressional testimony - all due on Thursday. Overnight, the major Wall Street indexes slipped between 0.1% and 0.2%, with Apple Inc. leading losses on the Dow Jones Industrial Average.

Back home, stocks from IT, Teck and Metal counters were supporting the markets, while those from Consumer Durables, FMCG and Power counters were adding to the underlying cautious undertone. In scrip specific development, Cadila Healthcare gained after the company’s formulations manufacturing facility at Baddi received an Establishment Inspection Report (EIR) from the United States Food and Drug Administration (USFDA). Moreover, Adani Enterprises rallied after the company gave final investment approval for its controversial $4 billion Carmichael mine and rail project in Queensland.

The market breadth remained pessimistic, as there were 911 shares on the gaining side against 1422 shares on the losing side, while 129 shares remained unchanged.

The BSE Sensex is currently trading at 31260.60, down by 48.89 points or 0.16% after trading in a range of 31251.90 and 31430.32. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.19%, while Small cap index down by 0.25%.

The top gaining sectoral indices on the BSE were IT up by 2.98%, TECK up by 2.19%, Metal up by 0.30% and Oil & Gas up by 0.19%, while Consumer Durables down by 1.70%, FMCG down by 1.27%, Power down by 0.84%, Realty down by 0.81% and Auto down by 0.73% were the top losing indices on BSE.

The top gainers on the Sensex were TCS up by 3.62%, Infosys up by 2.58%, Wipro up by 1.38%, SBI up by 0.80% and GAIL India up by 0.75%. On the flip side, ITC down by 2.17%, ONGC down by 1.71%, Tata Motors down by 1.17%, Power Grid down by 1.17% and Larsen & Toubro down by 1.16% were the top losers.

Meanwhile, after reviewing the preparations of Goods and Service Tax (GST) which is to be rolled out on July 1, 2017, Prime Minister Narendra Modi has described the new tax regime as a turning point for the economy. He further said that the creation of one nation, one market and one tax would greatly benefit the common man, asserting that the implementation of GST from July 1, is the culmination of the concerted efforts of all stakeholders, including political parties, trade and industry bodies.

The prime minister took stock of various elements involved in the roll-out, he specifically reviewed aspects of implementation such as IT readiness, HR readiness, training and sensitisation of officers, query handling mechanism, and monitoring. He directed the officials that maximum attention be paid to cyber-security in IT systems linked to the GST.

In the review meeting, which was also attended by finance minister Arun Jaitley, and top-most officials from the Ministry of Finance, the PMO and the cabinet secretary. PM was informed that GST systems such as IT infrastructure, training of officials, integration with banks, and enrolment of existing taxpayers will be in readiness well in time for the July 1 implementation date.

The CNX Nifty is currently trading at 9664.15, down by 10.95 points or 0.11% after trading in a range of 9652.55 and 9709.30. There were 15 stocks advancing against 36 stocks declining on the index.

The top gainers on Nifty were HCL Tech up by 5.23%, TCS up by 3.61%, Infosys up by 2.61%, Tech Mahindra up by 2.05% and IOC up by 1.24%. On the flip side, Indiabulls Housing down by 2.17%, ITC down by 2.11%, ONGC down by 1.88%, Tata Motors - DVR down by 1.73% and Bank Of Baroda down by 1.29% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 decreased 0.89%, Taiwan Weighted shed 0.2%, Jakarta Composite dropped 0.31% and Shanghai Composite was down by 0.07%. On the flip side, FTSE Bursa Malaysia KLCI gained 0.09% and Hang Seng was up by 0.4%.