Sensex, Nifty pare gains

Indian equity benchmarks pared most of their gains in late afternoon session, despite firm opening in European markets. Heavy sell-off in Capital Goods, IT and TECK stocks dragged the markets down. Besides, major industry laggard like Yes Bank, Maruti Suzuki and Asian Paints also weighed on the domestic sentiments. The street got cautious with a report that as many as 59 mega central sector infrastructure projects, worth at least Rs 1,000 crore each, have reported cost overrun of Rs 1.36 lakh crore. However, the key indices managed to keep their heads above neutral lines, taking support with Commerce and Industry Minister Suresh Prabhu’s statement that India may register healthy growth rates in exports in the coming months, despite increasing global protectionism. He added that the country’s exports are expected to touch $350 billion in the current fiscal year (FY19). On the sectoral front, cement stocks were trading higher, aided by credit rating agency ICRA’s latest report stating that cement demand is likely to grow by around six per cent in 2018-19, on the back of a pick-up in the affordable and rural housing segments and infrastructure, primarily in road and irrigation projects.

On the global front, European markets were trading in green, after the United States and the European Union stepped back from the brink of a trade war amid heightened tensions between them. US President Donald Trump and European Commission chief Jean-Claude Juncker have agreed to work for zero tariffs, zero non-tariff barriers, and zero subsidies on non-auto goods. They also agreed to increase trade in services and agriculture, including greater US soybean exports to the EU. Asian markets were trading mixed, as investors awaited cues from US second-quarter GDP data on Friday and the Bank of Japan's policy meeting due next week. Back home, in scrip specific development, PSP Projects gained after the company received work orders worth Rs 174.33 crore on consolidated basis during the month of July 2018 for industrial, institutional and residential projects from various clients which inter alia includes MRF, Zydus Cadila Group and Torrent Pharmaceuticals.

The BSE Sensex is currently trading at 36885.59, up by 27.36 points or 0.07% after trading in a range of 36852.53 and 37027.02. There were 17 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.65%, while Small cap index was up by 0.11%.

The top gaining sectoral indices on the BSE were PSU up by 1.51%, Utilities up by 1.29%, Power up by 1.04%, Bankex up by 0.82% and Realty up by 0.55%, while Capital Goods down by 0.85%, IT down by 0.78%, TECK down by 0.77%, Metal down by 0.60% and Consumer Disc down by 0.59% were the top losing indices on BSE.

The top gainers on the Sensex were SBI up by 4.33%, ICICI Bank up by 3.91%, Power Grid Corporation up by 2.93%, Tata Motors - DVR up by 1.13% and Axis Bank up by 0.90%. On the flip side, Yes Bank down by 6.26%, Maruti Suzuki down by 3.56%, Asian Paints down by 1.68%, Larsen & Toubro down by 1.59% and Kotak Mahindra Bank down by 1.05% were the top losers.

Meanwhile, amid pick-up in the affordable and rural housing segment and infrastructure- primarily in road and irrigation projects, credit rating agency, ICRA in its latest report has said that the demand for cement is likely to grow by around 6% in the current financial year.

As per the report, cement production during the December 2017-May 2018 period was in the range of 2628.5 million tone and in March 2018, it was highest at 28.5 million tone. The demand from various areas such Andhra Pradesh and Telangana, the eastern region and the western markets provided the support to the production. However, the report noted that sand unavailability continued to impact demand in Rajasthan.

ICRA also mentioned that the cement prices remained flat in Q1 FY19, as rising supplies have not resulted in a significant increase in the cement prices even though the demand momentum is healthy. However, they declined by around 5-6% on a pan-India level in Q1 FY19 and are also expected to remain under pressure in Q2 FY19 due to the monsoons.

Besides, the rating agency found that higher power and fuel (increase in coal and pet coke prices) and freight costs (increase in diesel prices) in the near term are likely to continue to put pressure on the profitability margins and debt metrics of the cement companies.

The CNX Nifty is currently trading at 11138.65, up by 6.65 points or 0.06% after trading in a range of 11125.75 and 11179.60. There were 24 stocks advancing against 26 stocks declining on the index.

The top gainers on Nifty were SBI up by 4.75%, Eicher Motors up by 4.17%, ICICI Bank up by 3.95%, Power Grid Corporation up by 2.85% and Grasim Industries up by 2.79%. On the flip side, Yes Bank down by 5.72%, Maruti Suzuki down by 3.57%, Indian Oil Corporation down by 2.36%, Hindalco down by 2.25% and Larsen & Toubro down by 1.82% were the top losers.

Asian markets were trading mixed; Jakarta Composite increased 2.40 points or 0.04% to 5,936.29, Straits Times was up by 6.18 points or 0.19% to 3,333.01, Taiwan Weighted surged 44.82 points or 0.41% to 11,010.61 and KOSPI rose 16.03 points or 0.7% to 2,289.06. On the flip side, Hang Seng fell 139.76 points or 0.49% to 28,781.14, Nikkei 225 lost 27.38 points or 0.12% to 22,586.87 and Shanghai Composite decreased 20.71 points or 0.72% to 2,882.94.

All European markets were trading in green; UK’s FTSE 100 increased 0.65 points or 0.01% to 7,658.91, France’s CAC gained 35.09 points or 0.64% to 5,461.50 and Germany’s DAX jumped 175.44 points or 1.38% to 12,754.77.