Markets trade at day's low; Nifty below 9,850 mark

Extending their early losses, the local equity markets continued weak trade and were now trading at day’s low points in early afternoon session, on the back of sustained selling activities by market-participants. The mood on the street remained cautious with the report stating that the collections under the GST in August slowed down by 3.6 percent to Rs 90,669 crore, than the revised mop-up of Rs 94,063 crore in July. The markets didn’t took note of Asian Development Bank’s statement that there is some scope for further rate cut by Reserve Bank of India (RBI) in the latter part of financial year 2018. Moreover, depreciation in Indian rupee for the third day in a row on account of appreciation of the dollar overseas, also dragged down the domestic benchmarks. The broader markets also extended losses with the BSE Midcap and Smallcap indices dropping by 0.56% and 0.35%, respectively. In scrip specific development, National Fertilizers (NFL) was up by over half a percent after receiving permission from Commerce Ministry for importing urea for three months.

On the global front, Asian markets were trading mostly in red, after Federal Reserve Chair Janet Yellen pressed the need to continue with rate hikes, lifting the dollar and US Treasury yields and reducing the appeal of regional currencies. Back home, the BSE Sensex is currently trading at 31380.15, down by 219.61 points or 0.69% after trading in a range of 31364.37 and 31797.46. There were 5 stocks advancing against 25 stocks declining on the index, while 1 stock remained unchanged.

The broader indices were trading in red; the BSE Mid cap index was down by 0.56%, while Small cap index was down by 0.35%.

The top gaining sectoral indices on the BSE were Realty up by 0.25%, Telecom up by 0.22%, Consumer Durables up by 0.22%, IT up by 0.12% and TECK up by 0.06%, while Metal down by 1.50%, Healthcare down by 1.35%, Bankex down by 1.05%, Energy down by 0.85% and Capital Goods down by 0.81% were the top losing indices on BSE.

The top gainers on the Sensex were TCS up by 0.96%, ITC up by 0.55%, Mahindra & Mahindra up by 0.11%, Bharti Airtel up by 0.10% and Bajaj Auto up by 0.01%. On the flip side, Adani Ports & SEZ down by 2.94%, Sun Pharma down by 2.55%, ICICI Bank down by 2.19%, Hindustan Unilever down by 1.71% and Reliance Industries down by 1.62% were the top losers.

Meanwhile, the domestic rating agency, ICRA in its latest report has said that petrol and diesel prices have jumped 8 percent since dynamic daily pricing for these fuels was introduced in mid-June. It also noted that the sharp increase in the price of petrol and diesel can be attributed to a 14 percent increase in international fuel prices. Apart from this, it also noted that the increase was also due to a 40 percent rise in dealer's commission to Rs 3.57 per litre from Rs 2.55 earlier and a moderate increase in marketing margins.

The report showed that the retail selling price of petrol in Delhi increased by 7.9 percent from Rs 65.23 per litre as on June 17 to Rs 70.41. However, it pointed out that sustained rise in fuel prices in absence of moderation in taxes (excise duty and VAT), could impact the growth in demand, besides leading to inflationary pressures in the economy. It further said that due to the earlier practice of fortnightly revisions, the price changes were at times sharp which would now be gradual, leading to lesser resistance from the public and lower risk of political intervention.

The rating agency further said that as dealers and some consumers were able to predict price movements, they had been resorting to bulk purchase or draw down from the inventory towards the end of the fortnight, depending on the direction of prices, resulting in some lumpiness in sales and opportunity loss on the marketing margins for oil companies. It also said that with greater autonomy and lower political intervention, oil firms could over time expand marketing margins, albeit increasing competition from private retailers would eventually moderate that. Moreover, it noted that any intervention by the government, which limits the freedom of oil marketing companies (OMCs) in price revisions, in light of rising fuel prices could be a credit negative.

The CNX Nifty is currently trading at 9810.25, down by 61.25 points or 0.62% after trading in a range of 9804.80 and 9921.05. There were 11 stocks advancing against 40 stocks declining on the index.

The top gainers on Nifty were Tech Mahindra up by 2.36%, Ambuja Cement up by 1.99%, Bharti Infratel up by 1.59%, Indian Oil Corporation up by 1.14% and TCS up by 0.94%. On the flip side, Adani Ports & SEZ down by 2.89%, Sun Pharma down by 2.63%, ICICI Bank down by 2.16%, Vedanta down by 1.87% and Hindustan Unilever down by 1.76% were the top losers.

The Asian markets were trading mostly in red; Nikkei 225 decreased 63.14 points or 0.31% to 20,267.05, Jakarta Composite declined 5.86 points or 0.1% to 5,858.10, FTSE Bursa Malaysia KLCI shed 1.79 points or 0.1% to 1,763.80 and KOSPI Index was down by 1.75 points or 0.07% to 2,372.57.

On the flip side, Shanghai Composite increased 1.72 points or 0.05% to 3,345.31, Taiwan Weighted rose 69.66 points or 0.68% to 10,326.68 and Hang Seng added 99.52 points or 0.36% to 27,612.53.