Markets turn red paring initial gains

Paring all their initial gains, Indian equity benchmarks entered into red terrain in early deals on Wednesday amid weakness in their Asian peers as investors looked ahead to a slew of U.S. data releases this week for hints on the interest rate outlook. Sentiments also remained dampened on report that the eight core industries’ output growth slowed to three-month low of 4.1 per cent in March, largely due to some base effect and contraction in crude oil production. The latest print was lower than the revised 5.4 per cent growth in February and 6.1 per cent in January. Also, the December 2017 print for core eight industries has been revised downwards to 3.8 per cent from 4.2 per cent projected earlier. However, losses remained capped as some solace came with report that the government mopped up over Rs 1 trillion in GST collection in April, indicating stabilisation of the new indirect tax regime which was rolled out on July 1 last year. While Goods and Services Tax (GST) collection in entire 2017-18 stood Rs 7.41 trillion, in March the figure was Rs 892.6 billion.

All the Asian stocks are trading in red in early deals on Wednesday, after most overseas benchmarks saw little change the previous day. The US markets ended mostly in green on Tuesday after the Institute for Supply Management released a report showing growth in manufacturing activity slowed by more than anticipated in the month of April.

Back home, Union Minister Suresh Prabu said that India, driven by a new industrial policy to be rolled out soon, will be the next engine of growth for the world. Auto stocks remained in top gear after companies released April month sales number.  SML Isuzu reported 49.5% growth in April sales, while M&M’s Auto Sector registered 22% growth in April sales. Moreover, Bajaj Auto has registered a rise of 26% in total sales to 4,15,168 units in April 2018 against 3,29,800 units in April 2017.

The BSE Sensex is currently trading at 35163.04, up by 2.68 points or 0.01% after trading in a range of 35132.37 and 35357.15. There were 14 stocks advancing against 17 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index slipped 0.07%, while Small cap index was up by 0.01%.

The top gaining sectoral indices on the BSE were Energy up by 0.63%, Auto up by 0.57%, Power up by 0.45%, Capital Goods up by 0.45% and Industrials was up by 0.43%, while IT down by 1.33%, Metal down by 1.16%, TECK down by 0.94%, Basic Materials down by 0.31% and Consumer Durables was down by 0.17% were the top losing indices on BSE.

The top gainers on the Sensex were Kotak Mahindra Bank up by 3.21%, Bajaj Auto up by 2.12%, Tata Motors up by 1.91%, Tata Motors - DVR up by 1.91% and Reliance Industries up by 1.17%. On the flip side, Infosys down by 1.31%, Coal India down by 1.30%, ICICI Bank down by 1.21%, TCS down by 1.12% and Hindustan Unilever down by 1.06% were the top losers.

Meanwhile, the growth of eight core infrastructure industries slowed to three-month low of 4.1% in March 2018, as compared to 5.3% in February 2018, on account of weak performance in as many as six sectors including coal, crude oil and natural gas. According to data released by the ministry of Commerce and Industry, the combined Index of eight core industries stood at 138.0 in March, 2018, which was 4.1% higher compared to the index of March, 2017. Its cumulative growth during April to March, 2017-18 was 4.2%. The Eight Core Industries - coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity - comprise 40.27% of the weight of items included in the Index of Industrial Production (IIP).    

Among eight core sectors, Coal production having 10.33% weight rose 9.1% in March, 2018 over March, 2017, and its cumulative index increased by 2.5% during April to March, 2017-18 over corresponding period of the previous year. Petroleum Refinery production having 28.04% weight increased 1.0% in March, 2018 over March, 2017 and its cumulative index surged by 4.6% during April to March, 2017-18 over the corresponding period of previous year.

The Natural Gas production having 6.88% inched up by 1.3% in March, 2018 over March, 2017, and its cumulative index was up by 2.9% during April to March, 2017-18 over the corresponding period of previous year. Steel production having 17.92% weight rose 4.7% in March, 2018 over March, 2017 and its cumulative index jumped by 5.6% during April to March, 2017-18 over the corresponding period of previous year.

Crude Oil production having 8.98% weight declined by 1.6% in March, 2018 over March, 2017 and its cumulative index fell by 0.9% during April to March, 2017-18 over the corresponding period of previous year. Fertilizer production having 2.63% weight increased by 3.2% in March, 2018 over March, 2017, and its cumulative index rose 0.03% during April to March, 2017-18 over the corresponding period of previous year. On the other hand, Cement production having 5.37% weight jumped 13% in March, 2018 over March, 2017 and its cumulative index increased by 6.3% during April to March, 2017-18 over the corresponding period of previous year.

The CNX Nifty is currently trading at 10731.55, down by 7.80 points or 0.07% after trading in a range of 10725.50 and 10784.65. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Kotak Mahindra Bank up by 3.05%, Zee Entertainment up by 2.38%, Bajaj Auto up by 2.03%, Tata Motors up by 1.94% and Cipla up by 1.64%. On the flip side, HCL Tech down by 3.27%, Vedanta down by 2.16%, Coal India down by 1.67%, Tech Mahindra down by 1.61% and TCS down by 1.36% were the top losers.

All the Asian markets are trading in red; Hang Seng decreased 185.72 points or 0.6% to 30,622.73, Nikkei 225 slipped 50.28 points or 0.22% to 22,457.75, FTSE Bursa Malaysia KLCI declined 22.52 points or 1.2% to 1,847.85, Shanghai Composite dropped 11.78 points or 0.38% to 3,070.45, KOSPI Index shed 8.46 points or 0.34% to 2,506.92, Taiwan Weighted dipped 7.48 points or 0.07% to 10,650.40 and Jakarta Composite was down by 6.52 points or 0.11% to 5,988.08.