Benchmarks make soft start on F&O expiry day

Resuming their southward journey, Indian equity benchmarks started the F&O series expiry session on a pessimistic note and are trading with a cut of around half a percent in early deals on Thursday. Sentiments remained downbeat on report that the country’s investment climate during April-December period of this fiscal looks subdued with declining figures in announcements of new projects and the number of projects under execution. The value of investment in new projects during April-December was Rs 4.43 trillion, less than half of Rs 9.21 trillion in the comparable period of last fiscal. Traders also remained concerned on report that minutes from the Reserve Bank of India’s meeting this month showed monetary policy committee members expressing concerns about accelerating inflation, although that was also tempered by uncertainty about the strength of an economic recovery. Market participants shrugged off report that India’s Gross Domestic Product (GDP) growth in the third quarter of the current fiscal is likely to be in the range of 6.5-7 per cent and may expand further in following three months. The country’s GDP grew by 6.3 per cent in July-September quarter of the fiscal, up from 5.7 per cent in the first quarter.

Global cues too remained sluggish with most of the Asian markets trading in red at this point of time, as investors worried surging bond yields after the Fed’s latest comments on the economy will test equity valuations. The US markets ended lower on Wednesday after the minutes of the Federal Reserve’s January meeting indicated the central bank still plans to raise interest rates three times in 2018.

Back home, NITI Aayog CEO Amitabh Kant has said that the Aayog has already recommended 40 sick PSUs for strategic disinvestment and is making an additional list of sick PSUs that can be privatised. The government expects to raise Rs 80,000 crore from PSU disinvestment in the next fiscal, lesser than Rs 1 trillion raised this year. In scrip specific development, Godrej Properties surged on adding new residential project in Gurgaon and Glenmark Pharmaceuticals edged higher on entering into exclusive agreement with SCD.

The BSE Sensex is currently trading at 33714.71, down by 130.15 points or 0.38% after trading in a range of 33691.56 and 33817.09. There were 8 stocks advancing against 23 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index shed 0.31%, while Small cap index was down by 0.34%.

The few gaining sectoral index on the BSE were IT up by 0.87%, TECK up by 0.40% and Consumer Durables was up by 0.31%, while Oil & Gas down by 1.35%, Telecom down by 1.12%, Energy down by 1.03%, Auto down by 1.00% and PSU was down by 0.84% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 1.08%, TCS up by 0.62%, Infosys up by 0.59%, Indusind Bank up by 0.58% and Wipro was up by 0.26%. On the flip side, ONGC down by 1.89%, Asian Paints down by 1.83%, Tata Motors down by 1.34%, Tata Motors - DVR down by 1.30% and Maruti Suzuki was down by 1.22% were the top losers.

Meanwhile, ahead of the release of Gross Domestic Product (GDP) data by Central Statistics Office, the State Bank of India (SBI) Research in its latest report has said that Indian economy is likely to grow in the range of 6.5-7 percent during the third quarter of the current fiscal year 2017-18. It also said that the country’s economy in fourth quarter of FY18 may grow by 7 percent. Besides, the country’s GDP grew by 6.3 percent in Q2 FY18, up from 5.7 percent in the Q1 FY18.

According to the SBI’s research report Ecowrap, the yearly SBI Composite Index for February 2018 is at 33-month high at 55.0 (moderate growth), compared to 52.1 (moderate growth) in January 2018. It also expects that manufacturing Gross Value Added (GVA) would be in the range of 8-10 percent for the Q3 FY18, if the current trend persists for remaining companies also. It added that a synchronised global growth coupled with an uptick in commodity cycle will also help sectors like metals, textiles and sugar.

However, the report warned that the recent developments in the financial markets may restrict the further growth of the Indian economy. SBI Research expects that it to be a passing phase in business cycle. Besides, the financial markets have been impacted following Rs 11,400 crore fraud at India’s second largest bank Punjab National Bank (PNB).

The CNX Nifty is currently trading at 10347.75, down by 49.70 points or 0.48% after trading in a range of 10340.65 and 10365.05. There were 10 stocks advancing against 40 stocks declining on the index.

The top gainers on Nifty were HCL Tech up by 1.81%, Tech Mahindra up by 1.29%, Sun Pharma up by 0.88%, Infosys up by 0.73% and TCS was up by 0.64%. On the flip side, BPCL down by 4.73%, Hindalco down by 2.51%, Asian Paints down by 2.09%, ONGC down by 2.05% and Bharti Infratel was down by 2.00% were the top losers.

Asian market are trading mostly in red; Hang Seng shed 336.12 points or 1.07% to 31,095.77, Nikkei 225 declined 256.52 points or 1.17% to 21,714.29, Taiwan Weighted fell 48.61 points or 0.45% to 10,665.83, Jakarta Composite slipped 18.91 points or 0.28% to 6,624.49, KOSPI Index dropped 14.81 points or 0.61% to 2,414.84 and FTSE Bursa Malaysia KLCI was down by 2.68 points or 0.14% to 1,855.49.

On the side flip, Shanghai Composite gained 62.4 points or 1.95% to 3,261.56.