Markets hit fresh intraday lows; PSU banks lead decline

With bears dominating the session, Indian equity benchmarks extended their southward journey in late afternoon session to hit fresh intraday lows, as negative cues from European markets and heavy selling pressure in banking, capital goods and realty stocks subdued investors’ sentiments. Besides, traders stayed cautious ahead of F&O expiry due this week and GST rollout lined up for June 30 midnight. The losses also came after public sector banks took a hit following a report that the Reserve Bank of India (RBI) has demanded higher provisioning for loans submitted under the insolvency process. Broader markets even fared worse, with BSE mid-cap and small-cap indices sliding 1.21% and 1.65%, respectively. Sentiments remained pessimistic with CRISIL enlightened that the steps taken by Reserve Bank to resolve NPAs are likely to raise provisioning by a whopping 25% this year as lenders will take up to 60% hair cut while resolving these accounts.

On the global front, European market were trading in red after the president of the European Central Bank, Mario Draghi, defended the bank's loose monetary policy and said a premature ending to easing could lead to another recession. Asian markets were trading in green. Back home, in scrip specific development, LT Foods edged higher on plan to inaugurate rice plant at Rotterdam, Netherlands in Europe with an initial processing capacity of 60,000 tonnes on June 28, 2017. The company would be manufacturing a wide range of rice including popular varieties like Basmati, Thai, Jasmine and American rice from the new plant.

The BSE Sensex is currently trading at 30877.78, down by 260.43 points or 0.84% after trading in a range of 30847.08 and 31294.96. There were 5 stocks advancing against 26 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 1.21%, while Small cap index was down by 1.65%.

The only gaining sectoral indices on the BSE were Telecom up by 1.38% and FMCG up by 0.18%, while PSU down by 1.96%, Bankex down by 1.91%, Realty down by 1.71%, Capital Goods down by 1.47% and Consumer Disc down by 1.34% were the losing top indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 2.23%, Adani Ports & SEZ up by 1.30%, ITC up by 0.98%, ONGC up by 0.41% and Hero MotoCorp up by 0.39%. On the flip side, SBI down by 3.79%, Axis Bank down by 3.54%, Infosys down by 1.81%, Bajaj Auto down by 1.72% and ICICI Bank down by 1.65% were the top losers.

Meanwhile, with less than one week remaining for Goods and Service Tax (GST) regime rollout, the Union Minister M Venkaiah Naidu, hailing it as the biggest tax reform since independence, has said that there will be some troubles initially but in the long term, the new tax regime will help consumers and traders. He also added that it will bring down inflation and prices, improve ease of doing business and strengthen the economy in long run.

Naidu further urged all political parties to support the GST which is scheduled to be rollout from July 1. The Union Minister also stated that the GST will bring economic integration, reduce delays and end discrimination among taxpayers, noting that power of taxation has now been given to the GST Council, which will be responsible for all taxation-related matters hereafter.

The minister also said that although 142 nations around the globe are implementing GST, India is unique because of the vastness of the country, its huge population and the midnight of June 30 will usher in a historic economic transformation.

The CNX Nifty is currently trading at 9488.20, down by 86.75 points or 0.91% after trading in a range of 9476.05 and 9615.40. There were 9 stocks advancing against 42 stocks declining on the index.

The top gainers on Nifty were Bharti Airtel up by 2.21%, GAIL India up by 1.55%, Adani Ports & SEZ up by 1.15%, ITC up by 0.95% and Indian Oil Corp. up by 0.82%. On the flip side, BPCL down by 4.49%, Bank of Baroda down by 4.23%, Zee Entertainment down by 3.99%, SBI down by 3.82% and Axis Bank down by 3.63% were the top losers.

Asian markets were trading mostly in green; KOSPI Index increased 3.29 points or 0.14% to 2,391.95, Shanghai Composite increased 5.75 points or 0.18% to 3,191.20 and Nikkei 225 increased 71.74 points or 0.36% to 20,225.09. On the flip side, Hang Seng decreased 31.9 points or 0.12% to 25,839.99 and Taiwan Weighted decreased 1.9 points or 0.02% to 10,512.06.

All European markets were trading in red; Germany’s DAX decreased 109.48 points or 0.86% to 12,661.35, France’s CAC decreased 54.75 points or 1.03% to 5,241.00 and UK’s FTSE 100 decreased 27.3 points or 0.37% to 7,419.50.