Markets enter into red terrain in late morning session

Indian equity benchmarks entered into red terrain in late morning session as investors awaited the interest rate decision from two-day Monetary Policy Committee meeting that started today. Besides, some anxiety spread among the investors as PMI survey data indicated that the introduction of the goods & services tax (GST) weighed heavily on the Indian manufacturing industry in July. The Nikkei/IHS Markit Manufacturing Purchasing Managers' Index fell to 47.9 in July from June's 50.9, its first reading below the 50 mark that separates growth from contraction since December and its lowest reading since February 2009. Some concerns also came with the report that investments in the domestic capital market through participatory notes (P-notes) slumped to Rs 1.65 lakh crore in June amid stringent norms put in place by Sebi to curb the inflow of illicit funds. However, the broader markets showed some fervor and traded in green, performing better than their larger peers.

On the global front, Asian market were trading in green as investors looked to a barrage of economic data around the world to confirm recent signs the global economy is in fine fettle with inflation staying well contained. Back home, in scrip specific development, Maruti Suzuki India traded higher after the company reported a jump of 20.6% in total sales at 1,65,346 units in July 2017. This includes 1,54,001 units in domestic market and 11,345 units of exports. The company had sold a total of 1,37,116 units in July 2016.

The BSE Sensex is currently trading at 32464.23, down by 50.71 points or 0.16% after trading in a range of 32462.25 and 32615.45. There were 18 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.43%, while Small cap index was up by 0.01%.

The top gaining sectoral indices on the BSE were Auto up by 1.18%, Metal up by 0.70%, Healthcare up by 0.64%, Consumer Disc up by 0.59% and Oil & Gas up by 0.47%, while Capital Goods down by 0.90%, Realty down by 0.43%, Power down by 0.40%, Telecom down by 0.27% and Bankex down by 0.23% were the top losing indices on BSE.

The top gainers on the Sensex were Dr. Reddy’s Lab up by 2.63%, Maruti Suzuki up by 2.22%, Wipro up by 1.90%, Mahindra & Mahindra up by 1.35% and Hindustan Unilever up by 1.22%. On the flip side, HDFC down by 1.74%, Asian Paints down by 1.51%, ONGC down by 1.39%, Larsen & Toubro down by 1.31% and SBI down by 0.91% were the top losers.

Meanwhile, the growth in eight core sectors -- coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity, which comprise nearly 40.27 percent of the weight of items included in the Index of Industrial Production (IIP), slowed to 0.4 percent in June 2017 as compared to 3.6 percent in May and 6.92 percent in the corresponding month last year, on the back of sharp decline in output of coal, refinery products, fertiliser and cement. The performance in June is the lowest since the growth of 0.18 percent in November 2015. According to that data released by the ministry of Commerce and Industry showed the combined Index of eight core industries stood at 121.0 in June, 2017, which was 0.4 percent higher compared to the index of June, 2016. Its cumulative growth during April to June, 2017-18 was 2.4 percent.

Among eight core sectors, Electricity generation having 19.85 percent weight surged 0.7 percent in June, 2017 over June, 2016 and its cumulative index increased by 4.9 percent during April to June, 2017-18 over the corresponding period of previous year. Petroleum Refinery production having 28.04 percent weight dropped 0.2 percent in June, 2017 over June, 2016, while its cumulative index increased by 1.8 percent during April to June, 2017-18 over the corresponding period of previous year. The Natural Gas production having 6.88 percent weight surged 6.4 percent in June, 2017 over June, 2016 and its cumulative index increased by 4.3 percent during April to June, 2017-18 over the corresponding period of previous year.

Steel production having 17.92 percent weight advanced 5.8 percent in June, 2017 over June, 2016. Its cumulative index increased by 6.2 percent during April to June, 2017-18 over the corresponding period of previous year. Crude Oil production having 8.98 percent weight inched up by 0.6 percent in June, 2017 over June, 2016 and its cumulative index increased by 0.2 percent during April to June, 2017-18 over the corresponding period of previous year. Cement production having 5.37 percent weight dipped by 5.8 percent in June, 2017 over June, 2016 and its cumulative index declined by 2.9 percent during April to June, 2017-18 over the corresponding period of previous year.

On the other hand, Fertilizer production having 2.63 percent weight declined by 3.6 percent in June, 2017 over June, 2016 and its cumulative index shed by 1.9 percent during April to June, 2017-18 over the corresponding period of previous year. Coal production having 10.33 percent weight slipped 6.7 percent in June, 2017 over June, 2016 and its cumulative index decreased by 4.4 percent during April to June, 2017-18 over corresponding period of the previous year.

The CNX Nifty is currently trading at 10067.45, down by 9.65 points or 0.10% after trading in a range of 10066.80 and 10101.90. There were 29 stocks advancing against 22 stocks declining on the index.

The top gainers on Nifty were Tech Mahindra up by 4.59%, Dr. Reddy’s Lab up by 2.92%, Hindalco up by 2.41%, Aurobindo Pharma up by 2.30% and BPCL up by 2.05%. On the flip side, HDFC down by 1.91%, Asian Paints down by 1.67%, HCL Tech down by 1.50%, Larsen & Toubro down by 1.47% and ONGC down by 1.36% were the top losers.

Asian markets were trading mostly in green; Shanghai Composite increased 6.78 points or 0.21% to 3,279.81, FTSE Bursa Malaysia KLCI increased 8.15 points or 0.46% to 1,768.18, Taiwan Weighted increased 9.96 points or 0.1% to 10,437.29, KOSPI Index increased 18.65 points or 0.78% to 2,421.36, Nikkei 225 increased 55.55 points or 0.28% to 19,980.73 and Hang Seng increased 161.53 points or 0.59% to 27,485.52.

On the flip side, Jakarta Composite decreased 12.09 points or 0.21% to 5,828.85.