Markets trade flat with negative bias

Indian equity benchmarks were trading flat with a negative bias in late afternoon session, as IT, FMCG and TECK stocks faced selling pressure. Investors remained cautious with Reserve Bank of India’s (RBI) latest survey stating that the Indian economy will gradually consolidate growth in the financial year 2017-18. It also reported that real gross domestic product (GDP) and real gross value added (GVA) are expected to increase by 7.4 percent and 7.2 percent, respectively, in the current fiscal and consolidate further by 40 basis points (bps) and 50 bps, respectively in the next fiscal. However, some losses got pared with the UN trade report that despite stagnant foreign direct investment (FDI) inflow of $ 44 billion in 2016, India will most likely remain most favoured destination due to its attractiveness among MNCs for cross-border mergers and acquisitions. Besides, the commerce ministry constituted a GST facilitation cell with a view to address issues regarding the new indirect tax regime in respect of foreign trade policy.

On the global front, European markets were trading in green as investors reacted to a hung parliament in the U.K.'s General Election. Asian markets were also trading in green. Back home, in scrip specific development, Reliance Capital inched up with its arm -- Reliance Commercial Finance planning to enter into used-car finance market. With this, the company, which has been largely focussing on SME lending across sectors, would be shifting its focus to the consumer finance sector.

The BSE Sensex is currently trading at 31191.52, down by 21.84 points or 0.07% after trading in a range of 31087.28 and 31209.83. There were 11 stocks advancing against 18 stocks declining on the index, while 1 stock remained unchanged.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.01%, while Small cap index was up by 0.45%.

The top gaining sectoral indices on the BSE were Realty up by 2.50%, Metal up by 1.18%, Auto up by 0.74%, Consumer Disc up by 0.54% and Bankex up by 0.43%, while IT down by 1.31%, TECK down by 1.06%, FMCG down by 0.84%, Oil & Gas down by 0.52% and Utilities down by 0.45% were the top losing indices on BSE.

The top gainers on the Sensex were Maruti Suzuki up by 2.37%, HDFC Bank up by 1.17%, Tata Motors up by 0.90%, Tata Steel up by 0.86% and Asian Paints up by 0.75%. On the flip side, GAIL India down by 2.19%, Wipro down by 2.12%, ITC down by 1.80%, Infosys down by 1.69% and ONGC down by 1.06% were the top losers.

Meanwhile, the department of Industrial Policy and Promotion (DIPP) will soon be announcing the standard operating procedure (SOP) for clearance of foreign investments proposals, as the 25-year old Foreign Investment Promotion Board (FIPB) has been abolished. In this regard the DIPP has prepared a draft SOP and is circulating it to different departments including the economic affairs to seek opinion.

The finance ministry had recently stated that the DIPP, in consultation with the administrative ministry, would come out with detailed guidelines for processing of the FDI proposals and ensuring a consistency of treatment and uniformity of approach. The FIPB portal would be linked with the e-biz portal. DIPP will now be the administrative body to manage the portal which will provide guidance on foreign direct investment. Besides, the website’s focus will be more on facilitation than approvals. The Department of Economic Affairs (DEA) will clear proposals of financial services which are not regulated by a regulator or where there is more than one regulator or there is a doubt about the regulator.

The government had recently abolished the FIPB to attract more FDI by providing quick approvals under a single-window clearance system. The move is expected to improve the ease of doing business in India. Besides, FDI approval decisions in majority of the sectors have been relegated to concerned ministries and those relating to private security agencies would be decided by the Ministry of Home Affairs.

The CNX Nifty is currently trading at 9640.60, down by 6.65 points or 0.07% after trading in a range of 9608.15 and 9646.35. There were 22 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Vedanta up by 2.90%, Maruti Suzuki up by 2.19%, HDFC Bank up by 1.23%, Hindalco up by 0.93% and Tata Motors up by 0.90%. On the flip side, Tech Mahindra down by 2.83%, GAIL India down by 2.21%, Wipro down by 2.19%, ITC down by 1.81% and Infosys down by 1.68% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 1.85 points or 0.1% to 1,787.42, Shanghai Composite increased 8.07 points or 0.26% to 3,158.40, KOSPI Index increased 18.12 points or 0.77% to 2,381.69 and Nikkei 225 increased 104 points or 0.52% to 20,013.26. On the flip side, Hang Seng decreased 32.77 points or 0.13% to 26,030.29, Jakarta Composite decreased 26.66 points or 0.47% to 5,676.26 and Taiwan Weighted decreased 26.13 points or 0.26% to 10,199.65.

All European markets were trading in green; France’s CAC increased 9.92 points or 0.19% to 5,274.16, UK’s FTSE 100 increased 33.93 points or 0.46% to 7,483.91 and Germany’s DAX increased 44.4 points or 0.35% to 12,757.98.