Key barometers continue weak trade

Local equity benchmarks extend losses to continue their weak trade in the morning session, hovering near the lowest point of the day on account of selling in frontline counters, as Sensex plunged over 650 points to an intra-day low and Nifty barometer Nifty50 was testing 10,650 level. Sentiments got hit with rupee touching another record low amid weak global cues and fears of widening current account deficit. Cautiousness prevailed on the street ahead of a Reserve Bank of India (RBI) statement due later this week. All the sectoral indices on the NSE slipped into the negative territory led by Energy, IT, TECK and Realty. Market took note of report that the Cabinet Committee on Economic Affairs has increased the minimum support prices (MSP) for Rabi crops in the range of 2-21% for 2018-19 from last year’s level. This comes after five out of six crops were already more than 50% of their A2+FL costs in 2017-18. On the sectoral front, oil marketing companies (OMCs) stocks slipped despite Reserve Bank of India (RBI) relaxed policy on borrowing from overseas to allow state-owned fuel retailers to raise up to $10 billion external debt for working capital needs. Till now OMCs were not allowed to raise external commercial borrowing (ECB) for working capital needs on a long-term basis.

On the global front, all Asian markets were trading in red, with some of the markets paring early gains, as upbeat US economic data drove 10-year US Treasury yields to their highest level since 2011 and also raised concerns about the outlook for interest rates. Back home, in the scrip specific development, Indian Energy Exchange trades in green, with electricity prices on the Indian Energy Exchange continue to soar, with the highest rate for a 15-minute block to be supplied going up to as high as Rs 18.2/unit, the highest in 10 years. The average spot power price at the exchange was Rs 7.49/unit, a 75% rise on a year-on-year basis.

The BSE Sensex is currently trading at 35321.36, down by 654.27 points or 1.82% after trading in a range of 35278.02 and 35820.53. There were 6 stocks advancing against 25 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index slipped 1.31%, while Small cap index was down by 1.52%.

The only gaining sectoral indices on the BSE were Capital Goods up by 0.43% and Metal was up by 0.04%, while Energy down by 3.48%, IT down by 2.79%, TECK down by 2.41%, Realty down by 2.10% and Oil & Gas down by 1.98% were the top losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 1.89%, Larsen & Toubro up by 1.56%, Yes Bank up by 1.39%, Tata Motors - DVR up by 0.74% and Tata Motors was up by 0.51%. On the flip side, Reliance Industries down by 4.82%, Hero MotoCorp down by 4.15%, TCS down by 3.82%, Hindustan Unilever down by 3.46% and Indusind Bank was down by 2.75% were the top losers.

Meanwhile, Telecom Regulatory Authority of India (TRAI) in its Indian Telecom Services Performance Indicator report has indicated that the gross revenue of telecom service providers and the licence fee collected by the government dropped by around 10 percent to Rs 58,401 crore and Rs 2,929 crore, respectively, on year-on-year basis, during the April -June period of 2018. It also noted that Gross revenue (GR) and adjusted gross revenue (AGR) of the telecom service sector for April-June quarter has been Rs 58,401 crore and Rs 36,552 crore, respectively.

According to the report, the year-on-year growth in GR and AGR declined by 10 and 8.11 percent, respectively. On quarter-on-quarter basis, the GR declined by 6.10 percent, while AGR increased by 2.40 percent in quarter June 2018. It pointed out that the decline in AGR, which is revenue earned from sale of telecom services, led to fall in licence fees paid to the government by around 10 percent to Rs 2,929 crore. Besides, it showed that the revenue of telecom operators from sale of services to retail subscribers, technically called access services, declined by 14.95 per cent to Rs 25,585 crore. The access services accounted for 70 per cent of the total AGR in the telecom segment.

The report further stated that in Access services, GR, license fee, spectrum usage charges and pass through charges declined by 9.07 percent, 2.88 percent, 2.21 percent and 21.86 percent, respectively in quarter ended June 2018. It noted that the GR and AGR of the telecom service providers have been on decline, barring few exceptions, after it peaked to Rs 73,344.66 crore and Rs 53,383.55 crore in April-June 2016 quarter with average revenue per user (ARPU) at Rs 140.88. The licence fee collected by the government during this quarter in 2016 was Rs 4,314 crore. The monthly ARPU in the April-June 2018 period declined by 12 per cent to Rs 73.34 oin yoy basis.

The CNX Nifty is currently trading at 10654.90, down by 203.35 points or 1.87% after trading in a range of 10641.90 and 10754.70. There were 6 stocks advancing against 44 stocks declining on the index.

The top gainers on Nifty were Bharti Infratel up by 3.32%, Axis Bank up by 1.70%, Larsen & Toubro up by 1.34%, Yes Bank up by 1.08% and Tata Motors was up by 0.62%. On the flip side, Eicher Motors down by 5.17%, Reliance Industries down by 4.98%, Tech Mahindra down by 4.28%, TCS down by 4.25% and Hero MotoCorp was down by 3.99% were the top losers.

All Asian markets were trading in red, Jakarta Composite slipped 99.67 points or 1.73% to 5,768.07, KOSPI fell 35.62 points or 1.57% to 2,273.95, Hang Seng dropped 461.63 points or 1.73% to 26,629.63, Nikkei 225 declined 76.73 points or 0.32% to 24,034.23, Taiwan Weighted decreased 125.19 points or 1.17% to 10,738.75 and Straits Times was down by 31.52 points or 0.97% to 3,235.88.