Benchmarks extend losses in morning session

Indian equity benchmarks extended their losses in morning session on account of selling in frontline counters. The rupee was trading up against dollar in the early trade on account of selling of American currency by exporters and banks. Traders remained cautious with a report from domestic rating agency Care Ratings, which said that employment generation has not kept pace with GDP expansion and termed it as a major concern. Such a scenario calls for proactive measures from government and the recent infrastructure building efforts will help, it noted and said that employment growth has not kept pace with economic growth. Mixed reactions were displayed in cement stocks on report that cement prices in northern states of India are expected to rise on the back of rising costs brought about by a ban on the use of pet-coke in the Delhi NCR region from November 1. The downside was capped after SBI Research in its latest report has accessed that Indian economy is likely to improve to 6 percent in the second quarter of the current fiscal year 2017-18, as against 5.7 percent growth in the first quarter of FY18. It also said that Q2 growth might be in the lower end of 6-6.5 percent band with an upward bias.

Traders were seen piling up position in Realty, Consumer Durables and Power stocks, while selling was witnessed in Metal, PSU and Telecom sector stocks. In scrip specific development, Reliance Communications was trading firm as the company presented a fresh zero write-off plan to its lenders, under which banks could convert some of its debt and take a majority 51% stake in the telecom operator.  Jaiprakash Power Ventures was trading in green on report that Brookfield and Resurgent Power have bid to acquire debt ridden company, which its lenders have put on the block under SDR.

On the global front, Asian markets were trading mostly in green. Growth in China’s manufacturing sector cooled more than expected in October in the face of tighter pollution rules that are forcing many steel mills, smelters and factories to curtail production over the winter. Back home, the BSE Sensex and NSE Nifty were trading below the psychological 33,200 and 10,350 levels respectively. The market breadth on BSE was positive in the ratio of 1167:1097, while 111 scrips remained unchanged.

The BSE Sensex is currently trading at 33194.24, down by 71.92 points or 0.22% after trading in a range of 33180.02 and 33294.30. There were 10 stocks advancing against 21 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.16%, while Small cap index was up by 0.09%.

The top gaining sectoral indices on the BSE were Realty up by 0.51%, Consumer Durables up by 0.50%, Power up by 0.24%, Bankex up by 0.10% and FMCG up by 0.01%, while Metal down by 1.41%, PSU down by 0.65%, Telecom down by 0.62%, TECK down by 0.57% and Oil & Gas down by 0.53% were the top losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 4.92%, HDFC up by 0.85%, Power Grid up by 0.68%, ONGC up by 0.67% and Hindustan Unilever up by 0.51%.

On the flip side, Infosys down by 1.86%, Coal India down by 1.83%, SBI down by 1.70%, Tata Steel down by 1.36% and Tata Motors down by 1.27% were the top losers.

Meanwhile, in the wake of increase in several macroeconomic indicators like trade, transport and communication, SBI Research in its latest report has accessed that Indian economy is likely to improve to 6 percent in the second quarter of the current fiscal year 2017-18, as against 5.7 percent growth in the first quarter of FY18. It also said that Q2 growth might be in the lower end of 6-6.5 percent band with an upward bias.

As per the report, index of industrial production (IIP) growth for September may be over 5 percent as mining and electricity growth is likely to be significantly better as state electricity boards had purchasing power because of festive demand. It noted that most of the lead indicators -- foreign tourist arrivals, international passenger and air freight traffic, railway traffic and telephone subscribers have shown an uptick in recent months.

SBI Research also said that consumption facing sectors are currently witnessing an increase in investment opportunities which ‘bodes well for the investment cycle going forward’. However, it observed that growth rate in agriculture sector is a point of concern. Agriculture growth may be muted as rainfall in the first three months of monsoon was hugely deficit in key foodgrain producing states like Uttar Pradesh, Punjab, Haryana, and Madhya Pradesh.

The CNX Nifty is currently trading at 10330.90, down by 32.75 points or 0.32% after trading in a range of 10327.20 and 10367.70. There were 14 stocks advancing against 36 stocks declining on the index.

The top gainers on Nifty were Axis Bank up by 4.97%, HCL Tech up by 1.62%, Ambuja Cement up by 0.92%, IndusInd Bank up by 0.89% and Power Grid up by 0.87%.

On the flip side, HPCL down by 2.17%, Bharti Infratel down by 2.12%, Hindalco down by 1.90%, Infosys down by 1.77% and Coal India down by 1.77% were the top losers.

The Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 1.55 points or 0.09% to 1,749.90, Nikkei 225 increased 6.04 points or 0.03% to 22,017.71, KOSPI Index increased 21.96 points or 0.88% to 2,523.89, Jakarta Composite increased 34.07 points or 0.57% to 6,008.15 and Taiwan Weighted increased 56.8 points or 0.53% to 10,813.67.

On the other hand, Hang Seng decreased 31.8 points or 0.11% to 28,304.39 and Shanghai Composite decreased 8.32 points or 0.25% to 3,382.01.