Local equities continue to trade in red terrain

Mirroring weak global cues, local equity indices continued their sluggish trade in the morning session, with Sensex and Nifty losing around 140 and 35 points, respectively, as traders remained on the sidelines ahead of the Reserve Bank of India’s (RBI) decision on the monetary policy and key interest rates on August 01. FMCG, Metal, Basic Materials and Oil & Gas succumbed to profit-booking, while realty, healthcare, power and consumer durables found investors’ support. Traders were concerned on a private report stating that there is 60% probability that the RBI in its three-day bi-monthly Monetary Policy Committee (MPC) meeting may hike repo rates by 25 basis points. Meanwhile, foreign portfolio investors (FPIs) sold shares worth a net of Rs 234.04 crore, while domestic institutional investors (DIIs) bought shares worth a net of Rs 48.58 crore on July 30. Traders shrugged off a report that corporate India’s business optimism index for the July-September quarter registered an 11.7% increase over last year. The Dun & Bradstreet Composite Business Optimism Index stood at 80.6 during the third quarter of 2018, an increase of 11.7% as compared to the corresponding period last year.

On the global front, Asian markets were trading mostly in red, after Wall Street posted losses amid weakness in the technology sector. Back home, on the sectoral front, Power index on the BSE rose 0.30% on Central Electricity Authority (CEA) report that the country is seen to have 2.5% surplus power available in FY19 than the peak demand of 180.7 giga-watt (GW). In scrip specific development, Escorts surges over 3% on reporting 93% rise in Q1 net profit. Beside, RPP Infra Projects gained on bagging order worth Rs 217.1 crore.

The BSE Sensex is currently trading at 37354.84, down by 139.56 points or 0.37% after trading in a range of 37336.74 and 37534.95. There were 15 stocks advancing against 16 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index gained 0.10%, while Small cap index was down by 0.05%.

The top gaining sectoral indices on the BSE were Realty up by 1.41%, Utilities up by 0.49%, Healthcare up by 0.45%, Power up by 0.30% and Consumer Durables was up by 0.29%, while FMCG down by 0.49%, Metal down by 0.48%, Basic Materials down by 0.44%, Oil & Gas down by 0.41% and Industrials was down by 0.33% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 1.27%, Asian Paints up by 1.26%, SBI up by 1.09%, NTPC up by 0.99% and Sun Pharma up by 0.99%. On the flip side, Tata Motors - DVR down by 1.87%, Vedanta down by 1.69%, HDFC down by 1.62%, Tata Steel down by 1.10% and Tata Motors down by 1.05% were the top losers.

Meanwhile, in view to reduce India’s import dependence, the government stated that a task force has been set up to identify various items and policy interventions. The country’s imports increased to $465.5 billion in 2017-18 from $384.3 billion in the previous fiscal. Minister of State for Commerce and Industry C R Chaudhary has said that the terms of reference of the task force include identification of products for import substitution, assessment of domestic manufacturing capacity and identification of constraints in expanding production.

Chaudhary noted that some countries including Saudi Arabia and Kuwait have imposed ban on import of certain agricultural products. Saudi Arabia imposed ban on imports chilled and frozen shrimps, and cultured fish since December 2016 and February this year respectively. Similarly, Kuwait has banned imports of frozen shrimp from India since January 2017. Thailand has imposed temporary suspension in view of the reported occurrence of Infectious Myonecrosis Virus (IMNV) disease, while Mexico’s ban on grounds of detection of larva of Trogodermagranarium (Khapra beetle) in Indian Chilli.

The Minister also said it is not feasible to quantify the losses suffered by the farmers due to such bans as alternative avenues for disposal of the produce, both domestic and international, are always available. He said ‘The government takes all possible steps to get the bans on import of Indian agricultural products lifted at the earliest. The matter is taken up with the relevant authorities in the respective countries through Indian Embassies. Corrective action, if required, is taken to eliminate the cause of ban.’

The CNX Nifty is currently trading at 11282.30, down by 37.25 points or 0.33% after trading in a range of 11273.95 and 11312.65. There were 23 stocks advancing against 26 stocks declining, while one stock remained unchanged on the index.

The top gainers on Nifty were Tech Mahindra up by 3.77%, Asian Paints up by 1.35%, Dr. Reddy’s Lab up by 1.34%, HCL Tech up by 1.34% and Bharti Airtel was up by 1.30%. On the flip side, Indiabulls Housing Finance down by 2.73%, BPCL down by 2.26%, HPCL down by 2.12%, Vedanta down by 1.91% and HDFC was down by 1.66% were the top losers.

Asian market were trading mostly in red; KOSPI slipped 1.84 points or 0.08% to 2,291.67, Taiwan Weighted dropped 9.30 points or 0.08% to 11,024.24, Nikkei 225 declined 19.43 points or 0.09% to 22,525.41, Hang Seng fell 147.10 points or 0.51% to 28,586.03, Shanghai Composite lost 0.90 points or 0.03% to 2,868.15 and Jakarta Composite was down by 90.41 points or 1.52% to 5,937.53.

On the other side, Straits Times was up by 5.24 points or 0.16% to 3,312.39.