Benchmarks trade slightly in green in early deals

Indian equity benchmarks are trading with caution, managing to keep their head above water in early deals, as traders took some support with IMF’s statement that India is a source of growth for the global economy for the next few decades and it could be what China was for the world economy. However, gains remained capped as some concern crept in with ICRA’s latest report that in spite of corporates witnessing a healthy 22% revenue growth in the June quarter, most have seen flat margins, with airline and cement companies seeing declining margins due to rising input costs and crude prices. Traders remain concerned with Care Ratings’ report that there has been a marginal decline of 1% in employment growth at 6.6%, mainly due to a larger number of companies having witnessed lower or negative hiring growth. It added that the employment growth in 2016-17, was at 7.7%.

On the global front, Asian markets are trading mostly in green at this point of time, on the back of firmer Wall Street earnings, while expectations for increased Chinese stimulus helped take the edge off wider concerns about the worsening Sino-US trade dispute. The US markets ended higher for third straight session on Tuesday, with strong corporate earnings reports lifting major indexes as tariff tensions simmer.

Back home, banking sector stocks edged higher despite report that Indian banks reported a total loss of about Rs 70,000 crore due to frauds during the last three fiscals up to March 2018. The extent of loss in fraud cases reported by scheduled commercial banks (SCBs) for 2015-16, 2016-17 and 2017-18 was Rs 16,409 crore, Rs 16,652 crore and Rs 36,694 crore, respectively. In scrip specific developments, Tata Motors gained on planning to launch 10-12 new products in passenger vehicles segment and M&M moved up on reporting 63% rise in Q1 net profit.

The BSE Sensex is currently trading at 37690.48, up by 24.68 points or 0.07% after trading in a range of 37641.40 and 37775.86. There were 17 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.08%, while Small cap index was up by 0.34%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 0.86%, Telecom up by 0.49%, Metal up by 0.33%, Basic Materials up by 0.21% and Consumer Disc was up by 0.15%, while PSU down by 0.32%, Power down by 0.32%, Utilities down by 0.28%, Oil & Gas down by 0.24%, and Realty was down by 0.24% were the top losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 1.10%, ONGC up by 0.66%, Bharti Airtel up by 0.58%, HDFC Bank up by 0.56% and Coal India was up by 0.49%. On the flip side, ICICI Bank down by 0.91%, Sun Pharma down by 0.67%, Wipro down by 0.67%, Axis Bank down by 0.65% and Infosys was down by 0.49% were the top losers.

Meanwhile, with an idea of minimizing float in the system, the government has anticipated to save as much as Rs 10,000 crore on interest payments through a new mechanism. This will be equal to the amount required to fund Ayushman Bharat, or Modicare.

The government said ‘just-in-time release’ of funds through a finance management platform has cut the amount of money floating in the system, which has resulted in interest savings. It added that the whole idea is to minimise float in the system and funds are now released only when implementing agencies need them. Moreover, out of about 20 lakh government agencies, 1 lakh have come on to the platform.

Besides, the Mahatma Gandhi National Rural Employment Guarantee Scheme would have a float of Rs 50,000 crore - Rs 60,000 crore. That’s now been brought to zero after it was brought on to the Public Financial Management System (PFMS) platform. The PFMS, administered by the Department of Expenditure and implemented by the Controller General of Accounts, is an end-to-end solution for processing payments, tracking, monitoring, accounting, reconciliation and reporting. It provides a unified platform for tracking releases and monitoring their last-mile utilisation.

The CNX Nifty is currently trading at 11391.20, up by 1.75 points or 0.02% after trading in a range of 11379.30 and 11422.85. There were 25 stocks advancing against 24 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Bajaj Finance up by 1.35%, Zee Entertainment up by 1.20%, Asian Paints up by 1.11%, Hindalco up by 1.07% and Bajaj Finserv was up by 0.96%. On the flip side, BPCL down by 1.65%, HPCL down by 1.59%, ICICI Bank down by 0.99%, HCL Tech down by 0.99% and Wipro was  down by 0.74% were the top losers.

Asian markets are trading mostly in green, Jakarta Composite gained 12.39 points or 0.2% to 6,103.64, Taiwan Weighted surged 92.53 points or 0.84% to 11,075.97, KOSPI advanced 5.98 points or 0.26% to 2,306.14, Nikkei 225 jumped 97.74 points or 0.43% to 22,760.48 and Hang Seng up 119.96 points or 0.42% to 28,368.84.

On the flip side, Straits Times slipped 18.99 points or 0.57% to 3,321.01 and Shanghai Composite down by 8.88 points or 0.32% to 2,770.49.