Sensex, Nifty continue to trade in negative territory

Tracking weak opening in European markets, the local equity benchmarks continued their trade in negative territory in late afternoon session, with the Sensex losing more than 100 points. In line with the larger peers, the broader markets also continued sluggish trade, with the losses of more than quarter a percent each. Sentiments got hit with the US report stating that growth in India has slowed due to the effects of its structural economic reforms. Besides, major industry losers like Dr. Reddy’s Lab, ONGC and Tata Motors, were also contributing to the losses, while Oil & Gas remained top loser among all other sectoral indices. Traders remained worried with 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. The market participants also took note of a private report that India has been ranked 81st in the global corruption perception index for 2017. Besides, surge in Foreign Direct Investment (FDI) failed to provide relief to the markets. FDI in India grew marginally by 0.27 percent to $35.94 billion during the first nine months of the current fiscal year 2017-18.

On the global front, European markets were trading in red, as heightened expectations of faster interest rate hikes in the US hampered risk appetite globally. Asian markets were also trading in red. Back home, in scrip specific development, Steel Strips Wheels (SSWL) traded higher after the company commissioned its Chennai Truck wheel plant from February 2018.

The BSE Sensex is currently trading at 33740.52, down by 104.34 points or 0.31% after trading in a range of 33691.42 and 33842.82. There were 10 stocks advancing against 21 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.30%, while Small cap index was down by 0.27%.

The top gaining sectoral indices on the BSE were Realty up by 0.83%, Healthcare up by 0.30%, IT up by 0.28% and Metal up by 0.04%, while Oil & Gas down by 1.33%, PSU down by 0.85%, Auto down by 0.80%, Telecom down by 0.77% and Utilities down by 0.69% were the losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 2.48%, Adani Ports & SEZ up by 1.82%, Indusind Bank up by 1.23%, Yes Bank up by 1.04% and Kotak Mahindra Bank up by 0.84%. On the flip side, Dr. Reddy’s Lab down by 2.96%, ONGC down by 2.03%, Tata Motors down by 1.51%, Power Grid Corporation down by 1.31% and ICICI Bank down by 1.19% were the top losers.

Meanwhile, in line with the general decline in interest rates, India’s retirement fund manager, the Employees’ Provident Fund Organization (EPFO) has slashed the interest rate on provident fund (PF) deposits to a five-year low of 8.55 per cent for 2017-18 from 8.65 per cent last fiscal, for its over 6 crore subscribers.

As per EPFO, the reduction in interest rate by 10 basis points will leave a surplus of Rs 586 crore as against Rs 695 crore surplus left in the last fiscal with interest rate of 8.65 per cent. The rate of interest decided at the Central Board of Trustees meeting will be vetted by the finance ministry and after approval, the rate of interest will be credited into subscribers’ account.

Labour Minister Santosh Gangwar has said that the EPFO received 8 per cent returns on its bond investments but it is able to pay 8.55 per cent rate because it has sold some of its investments in ETFs. He also explained that it is higher than 7.6 per cent provided to General Provident Fund and Public Provident Fund subscribers.

The CNX Nifty is currently trading at 10358.30, down by 39.15 points or 0.38% after trading in a range of 10340.65 and 10393.15. There were 15 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were Aurobindo Pharma up by 3.61%, Sun Pharma up by 2.28%, Adani Ports & SEZ up by 1.77%, Indiabulls Housing Finance up by 1.31% and Indusind Bank up by 1.27%. On the flip side, BPCL down by 4.18%, Dr. Reddy’s Lab down by 2.95%, Bosch down by 2.51%, Ambuja Cement down by 2.24% and ONGC down by 2.02% were the top losers.

Asian markets were trading in mostly in red; Hang Seng decreased 466.21 points or 1.48% to 30,965.68, Nikkei 225 decreased 234.37 points or 1.07% to 21,736.44, Taiwan Weighted decreased 52.06 points or 0.49% to 10,662.38, Jakarta Composite decreased 47.47 points or 0.71% to 6,595.93, KOSPI Index decreased 15.37 points or 0.63% to 2,414.28 and FTSE Bursa Malaysia KLCI decreased 1.34 points or 0.07% to 1,856.83. On the flip side, Shanghai Composite increased 69.4 points or 2.17% to 3,268.56.

All European markets were trading in red; Germany’s DAX decreased 105.23 points or 0.84% to 12,365.26, UK’s FTSE 100 decreased 73.89 points or 1.01% to 7,207.68 and France’s CAC decreased 29.45 points or 0.56% to 5,272.72.