Geopolitical concerns drag benchmarks lower in early deals

Indian equity benchmarks have made a somber start and are trading with a cut of around half a percent in early deals, as growing concerns over another test by North Korea is keeping investors across the globe on the edge. Sentiments also remained dampened with government saying that names of over 2.09 lakh firms have been struck off from register of companies for failing to comply with regulatory requirements and action has been initiated to restrict operations of their bank accounts. The Centre has also stepped up action against such entities by bringing in restrictions on the operation of their bank accounts by their existing directors and authorised representatives.

The global leads too remained sluggish with most of the Asian counters trading in red at this point of time with persisting North Korean worries. Traders girded for a potential intercontinental ballistic missile launch by Pyongyang, which will celebrate its ‘foundation day’ Saturday. The US markets coming after a long weakened suffered sharp selloff in the last session with tech heavy Nasdaq suffering its biggest one day fall in last three months.

Back home, stocks related to banking counters edged lower, as former RBI Governor Raghuram Rajan has said that the biggest challenge is cleaning up the balance sheets of public sector banks. Garment and textile stocks remained buzzing, as the garment exporters have asked the Centre for clarity on the refund process for Integrated Goods and Services Tax (IGST) paid on import of machinery as they were not in a position to use input tax credit.

The BSE Sensex is currently trading at 31651.40, down by 158.15 points or 0.50% after trading in a range of 31586.53 and 31713.50. There were 7 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index shed 0.16%, while Small cap index was down by 0.08%.

The few gaining sectoral indices on the BSE were Consumer Durables up by 0.72%, Energy up by 0.23%, Utilities up by 0.07% and Oil & Gas was up by 0.06%, while Realty down by 1.04%, Healthcare down by 0.92%, Metal down by 0.65%, FMCG down by 0.61% and IT was down by 0.58% were the top losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 0.76%, NTPC up by 0.53%, Asian Paints up by 0.42%, ONGC up by 0.34% and Maruti Suzuki up by 0.22%. On the flip side, Sun Pharma down by 2.59%, Tata Motors - DVR down by 1.44%, ITC down by 1.36%, Bajaj Auto down by 1.16% and Lupin down by 1.11% were the top losers.

Meanwhile, aiming to boost India’s agriculture exports, the new Commerce and Industry Minister Suresh Prabhu has said that the Ministry will soon bring out a policy framework for facilitating access to global markets for the Indian agriculture produce. He also said that the ministry will work on developing the global supply chain for the agriculture sector and added that multi-laterally there is also need to work on removing trade restrictions.

Prabhu also said that if farmers produce something, they should get an access to global market and get better prices for that, and for that, his ministry will put in place a good policy framework very soon. He said 'We will start working on that. This is on our agenda ... my ministry will make sure that we will achieve this goal to ensure that India's agriculture is also able to feed global economy.' Prabhu further said that the ministry will work on developing agriculture parks in India.

The government aims to double farmers’ income by 2022. Crop diversification, focus on allied sectors and food processing and tapping global markets are among the steps the government is taking to meet the target. According to the data by Agricultural and Processed Food Products Export Development Authority (APEDA), in 2016-17, export of agri products, such as cereals, processed fruit and vegetables, processed foods, and animal products, was around $16.27 billion.

The CNX Nifty is currently trading at 9903.60, down by 48.60 points or 0.49% after trading in a range of 9882.55 and 9911.90. There were 11 stocks advancing against 40 stocks declining on the index.

The top gainers on Nifty were GAIL India up by 1.64%, Reliance Industries up by 0.74%, Indiabulls Housing up by 0.73%, ONGC up by 0.46% and NTPC up by 0.29%. On the flip side, Sun Pharma down by 2.17%, Lupin down by 1.40%, Tata Motors - DVR down by 1.39%, ITC down by 1.38% and TCS down by 1.24% were the top losers.

Asian markets were trading mostly in red; Hang Seng declined 284.35 points or 1.02% to 27,457.00, Taiwan Weighted decreased 69.56 points or 0.66% to 10,548.28, Nikkei 225 shed 42.27 points or 0.22% to 19,343.54, Jakarta Composite fell 18.97 points or 0.33% to 5,811.01, Shanghai Composite slipped 9.59 points or 0.28% to 3,374.73 and KOSPI Index was down by 8.02 points or 0.34% to 2,318.60. On the flip side, FTSE Bursa Malaysia KLCI was up by 0.47 points or 0.03% to 1,770.10.