Indian equities remain in red terrain

Indian equity benchmarks continued their trade in red territory in afternoon session, tracking a weak trend in global markets amid fresh concerns of a possible China-US trade war. Domestic sentiment remained dampened with report that hardening domestic fuel prices are likely to weigh on the Reserve Bank’s rate setting panel, MPC, at its 3-day meet from June 4. The monetary policy review will take into account the retail inflation, which rose to 4.58% in the month of April 2018, as compared to 4.28% in March 2018 and 2.99% in April 2017, on account of increasing prices of petrol and diesel. Investors also maintained cautious approach ahead of Futures and Options (F&O) derivative expiry for May series due tomorrow. However, further down move got restricted with Ficci’s report that India’s GDP growth is expected at 7.1 per cent for the January-March quarter of the last fiscal and 6.6 per cent for the entire 2017-18. The Central Statistics Office (CSO) is scheduled to release GDP numbers for the fourth quarter as well as the 2017-18 fiscal on May 31.

On the global front, Asian markets were trading mostly in red, as the political turmoil in Italy and its impact on the long-term health of the euro zone weighed on investor sentiment. Back home, on the sectoral front, FMCG stocks remained under pressure despite private report stating that with the dust settling down for the FMCG industry after demonetisation and GST-led tax structure changes, shipments are clocking a high-growth trajectory in the first half of 2018. It has forecast a high single-digit growth rate for the sector in the April-June 2018 quarter versus the same period of 2017. It said that food categories will continue to grow significantly faster than personal care and home care categories.

The BSE Sensex is currently trading at 34835.24, down by 114.00 points or 0.33% after trading in a range of 34735.11 and 34876.13. There were 9 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index declined 0.19%, while Small cap index was down by 0.01%.

The few gaining sectoral indices on the BSE were Power up by 0.72%, Utilities up by 0.44% and Metal up by 0.06%, while Healthcare down by 0.72%, Oil & Gas down by 0.61%, Telecom down by 0.57%, Bankex down by 0.47% and Capital Goods down by 0.47% were the top losing indices on BSE.

The top gainers on the Sensex were Coal India up by 2.53%, Mahindra & Mahindra up by 2.43%, Power Grid up by 1.35%, Tata Steel up by 0.73% and Yes Bank up by 0.68%. On the flip side, ICICI Bank down by 1.79%, Tata Motors - DVR down by 1.59%, Tata Motors down by 1.43%, Axis Bank down by 1.08% and Bharti Airtel down by 1.02% were the top losers.

Meanwhile, amid various supporting factors like rising commodity prices along with depreciation of Indian rupee, Federation of Indian Export Organisations (FIEO) President Ganesh Gupta has said that Indian exports is likely to grow at 15-20% to touch $350 billion in FY19, despite increasing global protectionism.

However, Gupta expressed need of fiscal and non-fiscal incentives from the government, in order to drive shipments in both advanced and emerging markets. He is also hopes that the government will actively engage with trading partners particularly with the US to protect trade interest of the country. He further highlighted that the US decision to impose economic sanctions on Iran would create an opportunity for domestic exporters to increase their shipments to that country. He also pointed that the country may face challenge if sanctions will be imposed on the financial system.

Besides, FIEO President underlined the issues being faced by exports at insurance front, saying that Export Credit Guarantee Corporation of India (ECGC) delay the process of claims, which impact exporters and added that the FIEO has raised this issue with the commerce ministry.

The CNX Nifty is currently trading at 10595.35, down by 37.95 points or 0.36% after trading in a range of 10558.45 and 10602.70. There were 14 stocks advancing against 36 stocks declining on the index.

The top gainers on Nifty were Coal India up by 2.64%, Mahindra & Mahindra up by 2.20%, Bajaj Finance up by 1.51%, Power Grid up by 1.43% and Tech Mahindra up by 1.12%. On the flip side, HPCL down by 2.30%, Hindalco down by 2.21%, Vedanta down by 1.62%, ICICI Bank down by 1.62% and Grasim Industries down by 1.55% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 454.73 points or 1.49% to 30,029.85, Nikkei 225 shed 339.91 points or 1.52% to 22,018.52, Taiwan Weighted was down by 142.95 points or 1.3% to 10,821.17, Shanghai Composite dropped 64.99 points or 2.08% to 3,055.47 and KOSPI Index dipped 48.22 points or 1.96% to 2,409.03.

On the flip side, Jakarta Composite was up by 22.87 points or 0.38% to 6,091.20.