Sensex, Nifty off day’s low

Indian equity benchmarks trimmed some of their losses in late afternoon session to come off their intraday low points, on the back of heavy buying at Healthcare, IT and TECK counters. Firm broader indices along with gains led by major industry leaders like Sun Pharma, Dr. Reddy’s Lab and Tata Motors, also helped the bourses to pare their losses.  Domestic sentiments got relief with DIPP Secretary Ramesh Abhishek’s statement that foreign direct investment in India increased to $61.96 billion in 2017-18. He also said during the four years of the Modi government, foreign inflows jumped to $222.75 billion from $152 billion in the previous four-year period. Meanwhile, industry body Assocham said that reducing taxes is the best solution to check the spurt in fuel prices which would also tremendously help India on the exports front. However, the trade remained in red terrain amid weak cues from European markets. Besides, losing indices like Metal and Utilities were restricting the key indices to enter into green. Anxiety remained among the investors, as the government identified over 2.25 lakh companies and 7,191 LLPs which have not filed requisite financial statement for 2015-16 and 2016-17, and they may be struck off during the current financial year.

On the global front, European markets were trading in red, as investors awaited the Group of Seven leaders' meeting taking place amid intense tensions between US President Donald Trump and most of the participating statesmen. Investors also await directional cues from the US and European central bank meetings as well as the world's major oil producers meeting in Vienna on June 22. Asian markets were also trading in red. Back home, in scrip specific development, Cipla gained after the company entered into partnership with Eli Lilly and Company (India), a 100% subsidiary of Eli Lilly and Company, a global multinational pharmaceutical leader.

The BSE Sensex is currently trading at 35423.82, down by 39.26 points or 0.11% after trading in a range of 35260.00 and 35426.02. There were 12 stocks advancing against 18 stocks declining, while 1 stock remained unchanged on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.21%, while Small cap index was up by 0.37%.

The top gaining sectoral indices on the BSE were Healthcare up by 3.73%, IT up by 0.74%, TECK up by 0.62%, Consumer Durables up by 0.24% and Industrials up by 0.18%, while Metal down by 0.90%, Utilities down by 0.84%, Power down by 0.74%, Basic Materials down by 0.60%, Oil & Gas down by 0.45% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 8.65%, Dr. Reddy’s Lab up by 4.21%, Tata Motors - DVR up by 3.39%, Tata Motors up by 2.29% and Kotak Mahindra Bank up by 1.19%. On the flip side, Power Grid Corporation down by 2.37%, HDFC down by 1.52%, ICICI Bank down by 1.44%, Bharti Airtel down by 1.20% and HDFC Bank down by 1.07% were the top losers.

Meanwhile, pointing that Indian government’s planned capital infusions are enough to resolve the regulatory capital needs of 21 state-run banks, Global ratings agency Moody’s Investors Service in its latest report said that the recapitalization plan however will not be sufficient to support credit growth.

The report further estimated that the planned infusion of Rs 65,000 crore will help all PSBs meet the Common Equity Tier 1 (CET1) ratios exceeding the 8% minimum, by March 2019 and added that however, this development assumes overall credit growth for the PSBs of a modest 6-8% in this fiscal year.

Moody's further noted that capital shortfalls in PSBs are larger than the scale that the government had expected when it had announced the recapitalisation in October 2017, on the back of banks failure in raising additional capital from the market and it may be difficult  for the banks to raise more capital on the substantial decline in their share prices. The ratings agency also said that the weak financial performance and a sharp increase in government bond yields have deteriorated the capacity of these PSBs to generate internal capital, which hurt their investment income.

The CNX Nifty is currently trading at 10753.60, down by 14.75 points or 0.14% after trading in a range of 10709.05 and 10757.70. There were 20 stocks advancing against 30 stocks declining on the index.

The top gainers on Nifty were Sun Pharma up by 8.51%, Lupin up by 5.04%, Dr. Reddy’s Lab up by 4.42%, Cipla up by 3.56% and Tata Motors up by 2.24%. On the flip side, Hindalco down by 2.76%, Power Grid Corporation down by 2.69%, BPCL down by 1.93%, HDFC down by 1.63% and Grasim Industries down by 1.52% were the top losers.

All Asian markets were trading in red; Hang Seng decreased 554.42 points or 1.76% to 30,958.21, Nikkei 225 decreased 128.76 points or 0.56% to 22,694.50, Taiwan Weighted decreased 95.33 points or 0.85% to 11,156.42, Jakarta Composite decreased 69.19 points or 1.13% to 6,037.51, Shanghai Composite decreased 42.35 points or 1.36% to 3,067.15, KOSPI Index decreased 19 points or 0.77% to 2,451.58 and FTSE Bursa Malaysia KLCI decreased 8.1 points or 0.45% to 1,777.71.

All European markets were trading in red; Germany’s DAX decreased 184.56 points or 1.44% to 12,626.49, UK’s FTSE 100 decreased 58.29 points or 0.76% to 7,646.11 and France’s CAC decreased 29.96 points or 0.55% to 5,418.40.