Sluggish trend continues on street; Sun Pharma stocks slump

Pressurized by weak global cues, the Indian equity benchmarks continued to show a sluggish trend in early afternoon session, with Sensex and Nifty trading below their psychological levels of 31,900 and 9,950, respectively. Investors remained cautious with the report that capital market regulator SEBI directed exchanges to initiate action against 331 suspected shell companies. Moreover, rising geopolitical concerns after the US and North Korea exchanged threats, too kept the Street wary and uncertain. The markets didn’t took note of India Meteorological Department’s (IMD) report, which stated that that rainfall over the country during the second half of the monsoon season (August and September) is expected to be 100% of the benchmark long period average (LPA) with a model error of plus or minus 8%. Meanwhile, the rupee weakened by 10 paise to 63.73 against the US dollar in early trade as the greenback firmed up against other currencies overseas. In scrip specific development, Titan Company was up by over two percent after entering into partnership with Amazon, the world’s biggest online retailer, which will help India’s watch-to-jewellery maker to foray into online selling in the United States.

On the global front, Asian markets were trading in red on rising geopolitical risk after President Donald Trump warned the US will retaliate against North Korea, raising tension between the two countries. Back home, the BSE Sensex is currently trading at 31882.66, down by 131.53 points or 0.41% after trading in a range of 31843.45 and 31965.40. There were 11 stocks advancing against 20 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 1.00%, while Small cap index was down by 0.61%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 0.91%, Metal up by 0.62%, Realty up by 0.61%, Utilities up by 0.44% and IT up by 0.28%, while Healthcare down by 2.68%, Auto down by 0.93%, Industrials down by 0.90%, Telecom down by 0.79% and Bankex down by 0.55% were the top losing indices on BSE.

The top gainers on the Sensex were NTPC up by 1.66%, Infosys up by 0.80%, ONGC up by 0.55%, Hindustan Unilever up by 0.42% and SBI up by 0.38%. On the flip side, Sun Pharma down by 3.98%, Cipla down by 2.90%, Adani Ports & SEZ down by 2.42%, Tata Motors down by 2.38% and Bajaj Auto down by 2.35% were the top losers.

Meanwhile, Finance Minister Arun Jaitley has stated that the total expenditure of the government increased by 27 percent to over Rs 6.50 lakh crore in first quarter (April-June) of 2017-18, as a result of advancing the budget presentation by a month to February 1. He noted that the advancement of the Budget by a month was intended to utilise the full working season, including the Q1 FY18 to step up expenditure.

The minister highlighted that the government’s expenditure during the first quarter was Rs 6,50,731 crore, which is 30.3 percent of the amount budgeted for 2017-18 (Budget Estimate or BE) as against Rs 5,11,833 crore (25.9 percent of BE 2016-17) for the corresponding period of the previous year. Adding further, he said that previously when the budget got approved in mid-May, the spending would start only in the second quarter. He also said that this year, the Budget was presented on February 1 and Parliament approved it before the new financial year starts on April 1. He added that the government had brought forward the Budget presentation to provide allocation to the departments from the first day of the new financial year.

According to the data, in the April-June quarter in 2017, spending as a percentage of BE surged for 32 central ministries, including agriculture, defence, home, mines and Panchayati Raj, compared with the first three months of 2016. For the Ministry of Water Resources and Ganga Rejuvenation, it noted that the expenditure as a percentage of BE remained the same as previous fiscal. However, it also pointed out that for 23 ministries including textiles, power, shipping, environment and rural development, the expenditure as a percentage of BE has gone down compared with the last fiscal.

The CNX Nifty is currently trading at 9940.80, down by 37.75 points or 0.38% after trading in a range of 9925.90 and 9969.80. There were 17 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 2.36%, NTPC up by 1.81%, Indian Oil Corp. up by 1.62%, Vedanta up by 1.53% and Infosys up by 1.00%. On the flip side, Aurobindo Pharma down by 4.56%, Sun Pharma Inds. down by 4.38%, Cipla down by 2.96%, Adani Ports & SEZ down by 2.58% and Bajaj Auto down by 2.52% were the top losers.

All the Asian markets were trading in red; Nikkei 225 decreased 257.3 points or 1.29% to 19,738.71, Hang Seng dipped 104.75 points or 0.38% to 27,750.16, Taiwan Weighted shed 98.59 points or 0.93% to 10,470.38, KOSPI Index was down by 26.34 points or 1.1% to 2,368.39, Shanghai Composite declined 8.29 points or 0.25% to 3,273.58, FTSE Bursa Malaysia KLCI decreased 4.49 points or 0.25% to 1,777.16 and Jakarta Composite slipped 2.41 points or 0.04% to 5,808.16.