Markets continue to trade in negative territory; Metals lose sheen

The local equity benchmarks continued their trade in negative territory, despite positive cues from European markets. Both Sensex and Nifty were trading below their crucial 33,800 and 10,400 marks, respectively. Metal stocks declined the most among all the sectoral indices, as there were fears of a trade war, fuelled by United States President Donald Trump’s decision to impose import curbs on steel and aluminium. Trump will reportedly sign the order imposing the increased import tariffs this week. Besides, weak Indian services sector data, also kept the markets under pressure. The seasonally adjusted Nikkei India Services Business Activity Index fell from 51.7 in January to 47.8 in February, while the seasonally adjusted Nikkei India Composite PMI Output Index fell from 52.5 in January to 49.7 in February. There was some cautiousness with the reports that foreign investors have pulled out more than Rs 11,000 crore from Indian stocks in February 2018, amid better opportunities in other emerging markets. Major industry losers like Tata Motors, Tata Steel and Bajaj Auto, were also contributing to the losses, while the broader markets too remained lackluster in line with the larger peers.

On the global front, European markets were trading in green, even as fears of a global trade war persisted and it appears that Italy is heading for a hung parliament. However, Asian markets were trading in red. Back home, in scrip specific development, Shivam Autotech gained after the company achieved around 22% increase in sales in the month of February 2018 compared to corresponding month in the previous financial year.

The BSE Sensex is currently trading at 33769.09, down by 277.85 points or 0.82% after trading in a range of 33653.41 and 34034.28. There were 6 stocks advancing against 25 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.90%, while Small cap index was down by 1.15%.

The only gaining sectoral indices on the BSE were Consumer Durables up by 0.50% and IT up by 0.12%, while Metal down by 3.06%, Basic Materials down by 2.09%, Energy down by 2.01%, Oil & Gas down by 1.70% and Industrials down by 1.52% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 2.87%, TCS up by 1.61%, Mahindra & Mahindra up by 1.01%, SBI up by 0.48% and Kotak Mahindra Bank up by 0.42%. On the flip side, Tata Motors down by 3.91%, Tata Motors - DVR down by 3.20%, Tata Steel down by 2.87%, Bajaj Auto down by 2.52% and Reliance Industries down by 2.34% were the top losers.

Meanwhile, India’s services sector growth lost its momentum in the month of February, falling to a six-month low, as activity and new work orders shrank amid weak underlying demand conditions. Besides, accelerating input cost inflation and rising output charges, also pulled the index lower below the 50.0 no-change mark. The seasonally adjusted Nikkei Services Business Activity Index contracted to 47.8 in the month of February from 51.7 in January. The Nikkei India Composite PMI Output Index, which measures both manufacturing and services, also fell to 49.7 in February from 52.5 in January.

As per the survey report, the headline figure signalled the first fall in output for three months, but one that was modest. However, service providers remained optimistic towards the 12-month outlook for output, as staffing levels in the Indian service sector accelerated to the joint-strongest since June 2011, despite unfavourable demand conditions. Besides, factory employment also grew at the strongest pace in the context of historical data, even it was modest. The survey panel members stated that the new work decreased along with weak market demand and competitive conditions. 

Further, service providers recorded higher levels of outstanding business in the reported month, which they commonly associated with delayed payments. Similarly, backlogs at manufacturers increased at a modest pace but the rate of accumulation was strongest since October 2016. On the inflation front, input cost inflation in the Indian service sector quickened to the strongest since November, on the back of factors like greater fuel prices. Across manufacturing companies, input cost rose for the twenty-ninth consecutive month in February.

The CNX Nifty is currently trading at 10357.05, down by 101.30 points or 0.97% after trading in a range of 10323.90 and 10428.70. There were 7 stocks advancing against 43 stocks declining on the index.

The top gainers on Nifty were Sun Pharma up by 2.60%, TCS up by 1.51%, Tech Mahindra up by 1.48%, Mahindra & Mahindra up by 1.01% and SBI up by 0.57%. On the flip side, Hindalco down by 4.46%, Tata Motors down by 4.07%, Aurobindo Ambuja Cement Pharma down by 3.44%, down by 3.16% and HPCL down by 2.75% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 697.06 points or 2.28% to 29,886.39, Nikkei 225 decreased 139.55 points or 0.66% to 21,042.09, Taiwan Weighted decreased 55.27 points or 0.52% to 10,642.90, Jakarta Composite decreased 31.93 points or 0.49% to 6,550.39, KOSPI Index decreased 27.1 points or 1.13% to 2,375.06 and FTSE Bursa Malaysia KLCI decreased 14.79 points or 0.8% to 1,841.28. On the flip side, Shanghai Composite increased 2.4 points or 0.07% to 3,256.93.

European markets were trading mostly in green, France’s CAC increased 9.82 points or 0.19% to 5,146.40 and UK’s FTSE 100 increased 26.04 points or 0.37% to 7,095.94. On the flip side, Germany’s DAX decreased 6.67 points or 0.06% to 11,907.04.