Key gauges pare gains to trade flat

Indian equity benchmarks pared almost all of their early gains to trade flat in late morning deals, as domestic sentiments got hit with Niti Aayog vice chairman Rajiv Kumar’s statement that emergence of India as the sixth largest economy was very much expected but still there is a long way to go as the per capita income of the country is still low. Sentiments were pessimistic on report that the UK government's latest blueprint for Brexit released July 12 threatens to derail plans for closer trade ties with India as it would prevent Britain from making the kind of concessions on trade in goods. Sentiments also dampened on a report that Industrial production grew just 3.2% in May, the slowest in seven months, while retail inflation jumped to a five-month high of 5% in June, in a double whammy for the economy. Importantly, core retail inflation jumped to a 47-month high of 6.4% in June, raising chances of another rate hike by the monetary policy committee (MPC) in the coming months.

On the global front, Asian markets were trading mostly in green, as China refrained from detailing retaliation plans against threatened US tariff increases. Traders shrugged off a report which stated the US’ trade war with China that has resulted in increased tariffs on the import of each other’s products would have an adverse impact on farmers. Back home, in scrip specific development, Varroc Engineering gained with arm getting nod for setting up new facilities in India, Poland. Besides, Trigyn Technologies soared with arm extending contract with United Nations.

The BSE Sensex is currently trading at 36592.18, up by 43.77 points or 0.12% after trading in a range of 36548.99 and 36740.07. There were 14 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index slipped 0.51%, while Small cap index was down by 0.81%.

The few gaining sectoral indices on the BSE were Energy up by 0.72%, IT up by 0.72%, TECK up by 0.46% and Metal was up by 0.04%, while Realty down by 1.22%, Telecom down by 1.05%, PSU down by 0.93%, Power down by 0.73% and Capital Goods was down by 0.69% were the top losing indices on BSE.

The top gainers on the Sensex were Wipro up by 1.74%, Infosys up by 1.44%, Reliance Industries up by 1.16%, Coal India up by 0.94% and Adani Ports & SEZ was up by 0.84%. On the flip side, SBI down by 1.73%, Yes Bank down by 1.31%, Axis Bank down by 1.28%, ICICI Bank down by 1.23% and ONGC was down by 1.16% were the top losers.

Meanwhile, India’s retail inflation surged to five-month high of 5% in June 2018, for the third straight month, as compared to 4.87% in May. The jump in inflation based on Consumer Price Index (CPI) came on the back of a depreciating rupee and skyrocketing fuel prices. Besides, consumer food price inflation, a metric to gauge changes in monthly kitchen costs, was 2.91% higher than (-) 2.12% in June 2017, but it is lower as compared to 3.10% in May, due to slower rate of price rise articles such as fruits, vegetables and cereals. The earlier high was recorded in January this year at 5.07%.

As per the data of the Central Statistics Office (CSO), Ministry of Statistics and Programme, the CPI (Rural, Urban, Combined) on Base 2012=100 for June 2018, stood at 5.00%, 4.85% and 5.00% respectively, compared to 1.52%, 1.41% and 1.46% respectively in June 2017. The index value of CPI for combined stood at 138.6. The data also showed that Consumer Food Price Index (CFPI) for all India Rural and Urban for June 2018 stood at 3.74 % and 1.56%, respectively, compared to (-) 1.62% and (-) 3.16%, respectively in June 2017. The index value of CFPI for combined stood at 138.0 for the month of June.

According to the data, among the food articles, inflation of food and beverages eased to 3.18% in June 2018 from 3.29% in May 2018. Within the food items, the inflation eased for Fruits to 10.13%, Meat and fish 2.41%, Milk and products 3.04%, Prepared meals, snacks, sweets etc. 4.83% and Cereals and products 2.70% . On the other hand, the inflation rose for Pulses and products to (-)10.87%, Spices 2.37%, Vegetables 7.80% and Sugar and Confectionery (-)7.11%, while the inflation also moved up for Oils and fats to 2.62% and Non-alcoholic beverages 1.96% in June 2018.

Besides, the inflation for housing rose marginally to 8.45%, while that for miscellaneous items moved up to 5.74% in June 2018. Within the miscellaneous items, the inflation for Transport and communication increased to 6.18%, Education 5.83%, Household goods and services 5.18%, Health 6.07% and Recreation and amusement 5.24%, while it has eased for Personal care and effects to 5.43% in June 2018. The inflation for clothing and footwear was higher at 5.67%, while the CPI inflation of fuel and light increased to 7.14% in June 2018.

The CNX Nifty is currently trading at 11021.50, down by 1.70 points or 0.02% after trading in a range of 11007.70 and 11071.35. There were 17 stocks advancing against 33 stocks declining on the index.

The top gainers on Nifty were Infosys up by 1.59%, Wipro up by 1.54%, Reliance Industries up by 1.42%, Coal India up by 1.13% and Kotak Mahindra Bank was up by 1.12%. On the flip side, UPL down by 3.69%, Bharti Infratel down by 2.75%, HCL Tech down by 2.29%, Yes Bank down by 1.84% and SBI was down by 1.75% were the top losers.

Asian markets were trading mostly in green; Taiwan Weighted gained 102.76 points or 0.95% to 10,841.14, Straits Times rose 8.04 points or 0.25% to 3,261.05, Jakarta Composite strengthened 39.64 points or 0.67% to 5,947.51, Nikkei 225 surged 460.68 points or 2.03% to 22,648.64, Hang Seng soared 120.25 points or 0.42% to 28,601.08 and KOSPI was up by 23.55 points or 1.02% to 2,308.61. On the other side, Shanghai Composite was down by 6.47 points or 0.23% to 2,831.19.