Markets trade marginally lower in early session on F&O expiry

After falling in last session, Indian equity markets have made a flat to negative start and are now trading with marginal losses in early morning deals on F&O expiry day amid weak global cues. The broader indices too were trading in line with benchmarks. Some cautiousness prevailed in the markets with outgoing chief economic adviser Arvind Subramanian’s statement that apart from high oil prices, the biggest headwind for India’s growth prospects was stigmatised capitalism, or the view that the private sector could not be trusted. The market sentiments were further being weighed down by the weakness in rupee which fell in early trade on Wednesday due to fresh demand for the US currency from banks and importers. Rupee weakened by 28 paise to 68.89 against the dollar. It has weakened by over 8 percent for the year 2018.

Global front, US stocks ended lower on Wednesday on renewed uncertainty regarding the US stance on Chinese investments in American technology companies. Asian stocks slumped to nine-month lows on Thursday on growing worries the US administration’s approach to trade is harming global economic growth even as it appeared to be modifying its approach to curb Chinese investments in US technology firms.

Back home, traders were seen piling up position IT, TECK, Healthcare and FMCG, while selling was witnessed in Realty, Utilities, Capital Goods, PSU and Power. The market breadth on the BSE was negative; there were 678 shares on the gaining side against 1184 shares on the losing side, while 82 shares remained unchanged.

The BSE Sensex is currently trading at 35198.00, down by 19.11 points or 0.05% after trading in a range of 35126.85 and 35246.28. There were 13 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index declined 0.27%, while Small cap index was down by 0.70%.

The few gaining sectoral indices on the BSE were IT up by 0.84%, TECK up by 0.70%, Healthcare up by 0.28% and FMCG up by 0.03%, while Realty down by 1.63%, Utilities down by 1.45%, Capital Goods down by 1.29%, PSU down by 1.23% and Power down by 1.19% were the top losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 2.15%, Infosys up by 2.13%, Tata Steel up by 0.75%, HDFC Bank up by 0.66% and Sun Pharma up by 0.60%. On the flip side, NTPC down by 2.28%, Coal India down by 2.16%, Larsen & Toubro down by 1.60%, Hero MotoCorp down by 1.58% and ICICI Bank down by 1.43% were the top losers.

Meanwhile, in order to enhance insurance coverage and boost exports, the Cabinet Committee on Economic Affairs (CCEA) has given green signal to capital infusion of Rs 2,000 crore in Export Credit Guarantee Corporation (ECGC). The capital infusion will be done over the three financial years 2017-20.

The break-up of the infusion would be Rs 50 crore in 2017-18, Rs 1,450 crore in 2018-19, and Rs 500 crore in 2019-20. The infusion would enhance insurance coverage to micro, small and medium enterprises (MSME) exports and strengthen India’s exports to emerging and challenging markets like Africa and Latin American countries. More than 85% of customers benefitted by ECGC’s covers are MSMEs.

The Commerce Ministry has said that with enhanced capital, ECGC’s underwriting capacity and risk to capital ratio would improve considerably and it would be in a better position to support Indian exporters tap new and unexplored markets. ECGC provides export credit insurance services to facilitate exports from the country and protect exporters from losses due to non-payment of dues by overseas buyers.

The CNX Nifty is currently trading at 10645.95, down by 25.45 points or 0.24% after trading in a range of 10632.40 and 10663.75. There were 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Infosys up by 1.96%, Mahindra & Mahindra up by 1.90%, Kotak Mahindra Bank up by 0.72%, Tata Steel up by 0.72% and HCL Technologies up by 0.71%. On the flip side, HPCL down by 3.63%, GAIL India down by 3.04%, Grasim Industries down by 2.78%, NTPC down by 2.57% and Titan Company down by 2.49% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 declined 10.97 points or 0.05% to 22,260.80, Taiwan Weighted slipped 10.76 points or 0.10% to 10,690.27, KOSPI decreased 15.02 points or 0.65% to 2,327.01 and Jakarta Composite was down by 111.12 points or 1.96% to 5,676.43.

On the flip side, Straits Times gained 2.64 points or 0.08% to 3,257.41, Hang Seng increased 141.84 points or 0.50% to 28,498.10 and Shanghai Composite was up by 6.71 points or 0.24% to 2,819.89.