Benchmarks trade flat with positive bias

Indian equity benchmarks continued to trade flat with positive bias in morning session, after opening lower amid a global sell-off pressure triggered by lingering concerns over US-China trade war. Traders took encouragement with interim finance minister Piyush Goyal’s statement that the country is on a ‘safe wicket’ as far as the rupee is concerned and the currency will be stable in the long-term. Some optimism also came with a report that Commerce and Industry Minister Suresh Prabhu will meet over 20 Australian superannuation or pension funds in Sydney on June 26, to seek investments in areas like infrastructure, waste management and airports. Besides, a private report stated that Reserve Bank of India is expected to push key policy rates higher again in order to keep inflation in check. Earlier this month, the central bank had upped its retail inflation projection by 0.30% and kept the policy stance in the neutral zone. Investors overlooked Asian Infrastructure Investment Bank (AIIB) president’s statement that the current global scenario is risky and the ongoing issues need to be resolved soon so as to avoid an all-out trade war. The ongoing trade war between the US and China is a global concern and could easily impact the global economic growth.

On the global front, Asian markets were trading mostly in red, as Trump administration plans to limit exports of some high-tech products to China, and also limit investment in technology firms by companies with substantial Chinese ownership. Treasury Secretary Steven Mnuchin’s suggestion that the investment restrictions wouldn’t be limited to China weighted down on the sentiments. Back home, in scrip specific development, Aurobindo Pharma gained on receiving final approval from USFDA for Ertapenem Injection.

The BSE Sensex is currently trading at 35496.60, up by 26.25 points or 0.07% after trading in a range of 35338.09 and 35541.27. There were 17 stocks advancing against 13 stocks declining, while 1 stock remained unchanged on the index.

The broader indices were trading in red; the BSE Mid cap index slipped 0.18%, while Small cap index was down by 0.41%.

The top gaining sectoral indices on the BSE were FMCG up by 0.89%, Telecom up by 0.55%, Metal up by 0.31%, Basic Materials up by 0.26% and TECK was up by 0.19%, while Energy down by 0.82%, Industrials down by 0.41%, Consumer Durables down by 0.37%, Power down by 0.36% and Healthcare was down by 0.29% were the top losing indices on BSE.

The top gainers on the Sensex were Coal India up by 3.15%, HDFC up by 1.32%, Asian Paints up by 1.28%, ITC up by 1.28% and Bharti Airtel was up by 1.26%. On the flip side, Tata Motors down by 2.42%, Reliance Industries down by 1.70%, ICICI Bank down by 1.35%, Hero MotoCorp down by 1.01% and Tata Motors - DVR was down by 0.95% were the top losers.

Meanwhile, Indian companies’ investments into their overseas subsidiaries/joint ventures have dropped by 63% to $1.17 billion in May 2018 as compared to $3.12 billion in May 2017. According to RBI data, in April 2018, the outward foreign direct investment (OFDI) of Indian firms was $3.56 billion. Cumulatively, the overseas direct investment in first two months (April-May) of this fiscal stood at $4.73 billion.

As per the data, of the total investment by domestic firms in overseas ventures in the month under review, $374.18 million was in the form of equity infusion, $162.96 million in loan and $630.45 million as guarantee issuances. Among the major companies that made investment in their overseas subsidiaries/joint ventures included Indiabulls Real Estate $368.09 million, ONGC $57.94 million, Tata Hitachi Construction Machinery $26.62 million and Wadhawan Global Captial $15.23 million.

Besides, Department of Industrial Policy and Promotion (DIPP) Secretary Ramesh Abhishek recently had said that foreign direct investment (FDI) in the country witnessed a growth during 2017-18 to reach at $61.96 billion. India’s FDI inflows dropped to $40 billion in 2017 as compared to $44 billion in 2016. It also indicated that in South Asia, FDI inflows contracted by 4% to $52 billion, due to a fall in inflows to India.

The CNX Nifty is currently trading at 10772.10, up by 9.65 points or 0.09% after trading in a range of 10732.55 and 10782.30. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Coal India up by 3.86%, Ultratech Cement up by 2.65%, Grasim Industries up by 1.60%, Asian Paints up by 1.36% and HDFC up by 1.26%. On the flip side, Tata Motors down by 2.26%, Reliance Industries down by 1.64%, Cipla down by 1.53%, ICICI Bank down by 1.31% and Bajaj Finance down by 1.00% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 declined 0.73 points to 22,337.42, Straits Times shed 0.33 points or 0.01% to 3,260.51, Hang Seng dropped 85.22 points or 0.30% to 28,876.17, Taiwan Weighted slipped 40.50 points or 0.38% to 10,745.96, KOSPI decreased 3.32 points or 0.14% to 2,354.56, and Shanghai Composite was down by 13.39 points or 0.47% to 2,846.06.

On the flip side, Jakarta Composite was up by 9.75 points or 0.17% to 5,868.86.