Weak trade persists on Dalal Street

Weak trade continued on the Dalal Street in late afternoon session, with Sensex losing more than 100 points, mirroring weak European markets. Heavy selling pressure at Telecom, realty and FMCG counters, kept the markets down in late noon deals, while Bharti Airtel emerged as a top loser among major industry leaders on the BSE. Some cautiousness came with a private report that the 50 percent rise in shadow-banking loans in October was on account of difficulties in arranging money from money market alternatives but is unlikely to sustain. Traders failed to take any sense of relief with Revenue Secretary Ajay Bhushan Pandey’s statement that the new simplified GST return forms will be rolled out from April 1, 2019. He also exuded confidence that the government will achieve the budgeted target for Goods and Services Tax (GST) collection and said the revenue department is getting inputs about entities which are evading taxes.

On the sectoral front, auto stocks were trading lower, as ratings agency ICRA revised downwards its growth forecast for domestic passenger vehicles sales to 7-8 percent for the ongoing fiscal, citing sluggish customer sentiments due to high fuel prices and rising interest rate. ICRA had earlier projected a growth of 8-9 percent. Stocks related to the logistic industry were in focused, with a private report stating that demand for logistics infrastructure is booming in India due to the introduction of the GST that has revolutionised how goods are delivered across the country.

On the global front, European markets were trading in red, as Eurozone's manufacturing growth slowed in November, amid marginal growth in output and weak business confidence, and was the lowest since August 2016. The final data from IHS Markit showed that the manufacturing purchasing managers' index fell to 51.8 from 52 in October. The flash reading was 51.5. Asian markets were trading in red, reflecting concerns over how the US and China will resolve a range of issues from technology development to trade within the next 90 days.

The BSE Sensex is currently trading at 36137.03, down by 103.97 points or 0.29% after trading in a range of 36036.39 and 36295.84. There were 15 stocks advancing against 16 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.05%, while Small cap index was up by 0.22%.

The top gaining sectoral indices on the BSE were IT up by 1.85%, TECK up by 1.42%, Oil & Gas up by 1.12%, PSU up by 0.36% and Capital Goods up by 0.26%, while Telecom down by 1.48%, Realty down by 1.03%, FMCG down by 0.46%, Bankex down by 0.45% and Utilities down by 0.42% were the top losing indices on BSE.

The top gainers on the Sensex were ONGC up by 3.09%, Infosys up by 2.20%, TCS up by 1.80%, Tata Motors - DVR up by 1.73% and Wipro up by 1.72%. On the flip side, Bharti Airtel down by 2.54%, Sun Pharma down by 2.47%, HDFC down by 2.09%, Mahindra & Mahindra down by 2.05% and NTPC down by 1.52% were the top losers.

Meanwhile, amid sluggish customer sentiments on the back of rising interest rate and fuel prices, rating agency ICRA in its latest reports has revised its growth forecast for domestic passenger vehicles (PV) sales to 7-8 percent for the current fiscal from the earlier projected growth of 8-9 percent. But, the agency maintained stable outlook on domestic passenger vehicles industry for the year.

As per the report, the domestic PV sales declined to 6.1 percent during the first seven months of the FY2019. Besides, it said that factors like floods in Kerala (during peak Onam season) delayed festive season and high base of Q2 FY2018 also weighed on overall growth rate during Q2 FY2019 resulting in domestic wholesale PV dispatched declining by 3.6 percent.

However, ICRA found that the credit profile of most PV original equipment manufacturer (OEMs) remains strong, on account of healthy cash accruals and financial flexibility provided by strong parentage. The rating agency further added that the overall capacity utilisation level in the industry also remains modest.

The CNX Nifty is currently trading at 10868.85, down by 14.90 points or 0.14% after trading in a range of 10833.35 and 10890.95. There were 26 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were ONGC up by 3.23%, UPL up by 3.17%, BPCL up by 3.04%, Indiabulls Housing Finance up by 2.73% and Indian Oil Corporation up by 2.26%. On the flip side, Sun Pharma down by 2.70%, Mahindra & Mahindra down by 2.43%, Bharti Airtel down by 2.42%, HDFC down by 2.35% and HDFC Bank down by 1.40% were the top losers.

Asian markets were trading mostly in red; Straits Times decreased 25.01 points or 0.79% to 3,165.61, Nikkei 225 plunged 538.71 points or 2.44% to 22,036.05, Taiwan Weighted lost 54.33 points or 0.54% to 10,083.54 and KOSPI dipped 17.58 points or 0.83% to 2,114.35. On the flips side, Hang Seng increased 78.40 points or 0.29% to 27,260.44, Shanghai Composite gained 11.16 points or 0.42% to 2,665.96 and Jakarta Composite was up by 14.62 points or 0.24% to 6,132.94.

All European markets were trading in red; UK’s FTSE 100 decreased 0.82 points or 0.01% to 7,061.59, France’s CAC lost 25.03 points or 0.5% to 5,028.95 and Germany’s DAX was down by 48.36 points or 0.42% to 11,417.10.