Indian equities continue weak trade; Basic Materials stocks fall

Indian equity benchmarks continued their weak trade in afternoon session, on account of selling in frontline blue chip counters. Investors remained jittery ahead of the announcement of the Interim Budget on Friday. The mood on the street also remained cautious with Moody’s Investors Service’s statement that the steps announced by the government to aid MSMEs and the measures being planned to support farmers will increase the risk of fiscal slippage and push deficit to 3.4 per cent of GDP in the current financial year. The government budgeted the fiscal deficit for the current financial year at 3.3 per cent of the gross domestic product (GDP). Moreover, subdued quarterly numbers by select heavyweights coupled with a weak trend at other Asian bourses too weighed on the sentiment. The market participants shrugged off Union Commerce and Industry Minister Suresh Prabhu’s statement that new policies of the government will help to increase India’s export from the current $321 billion to almost double in a few years.

On the global front, Asian markets were trading mostly in red, as caution over looming trade talks between Washington and Beijing displaced relief over the end of the partial U.S. government shutdown. Back home, the BSE Sensex is currently trading at 35746.44, down by 279.10 points or 0.77% after trading in a range of 35667.94 and 36124.26. There were 5 stocks advancing against 26 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 1.58%, while Small cap index was down by 1.89%.

The top gaining sectoral indices on the BSE were Realty up by 0.29%, TECK up by 0.24%, IT up by 0.09% and Capital Goods up by 0.01%, while Basic Materials down by 1.99%, Healthcare down by 1.77%, Metal down by 1.69%, Bankex down by 1.63% and Power down by 1.38% were the top losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 1.66%, TCS up by 1.35%, Kotak Mahindra Bank up by 0.90%, Asian Paints up by 0.89% and Hindustan Unilever up by 0.17%. On the flip side, ICICI Bank down by 4.89%, Yes Bank down by 3.62%, Bajaj Finance down by 2.61%, Sun Pharma down by 2.18% and Bajaj Auto down by 2.09% were the top losers.

Meanwhile, the government has imposed anti-dumping duty for five years on import of Chinese chemical used in photography and manufacturing of dyes to guard domestic players from cheap imports from the neighbouring country. It is for the second time in a row that anti-dumping duty has been imposed on the import of the chemical from China. The duty was to expire in March 2019.

According to a notification of the Central Board of Indirect Taxes and Customs (CBIC), the anti-dumping duty on Meta Phenylenediamine (MPDA) imported from China will be in the range $573.92-$1,015.44 a tonne. The levy has been imposed after the Directorate General of Trade Remedies (DGTR), the investigation arm of the commerce ministry, made a recommendation for the same. DGTR was earlier known as the Directorate General of Anti-dumping and Allied Duties (DGAD). On the recommendation of DGAD, a definitive anti-dumping duty was imposed on the chemical in March 2014. Later, Aarti Industries filed an application before DGAD for review and continuation of the duty on the chemical.

Countries carry out the anti-dumping probe to determine whether the domestic industries have been hurt because of a surge in cheap imports. As a counter measure, they impose duties under the multilateral regime of the World Trade Organization. The duty is aimed at ensuring fair trading practices and creating a level-playing field for domestic producers with regard to foreign producers and exporters

The CNX Nifty is currently trading at 10689.80, down by 90.75 points or 0.84% after trading in a range of 10663.00 and 10804.45. There were 11 stocks advancing against 39 stocks declining on the index.

The top gainers on Nifty were Zee Entertainment up by 10.24%, Bharti Infratel up by 2.02%, Larsen & Toubro up by 1.59%, Wipro up by 1.41% and TCS up by 1.30%. On the flip side, Adani Ports &SEZ down by 7.40%, Indiabulls Housing Finance down by 5.45%, ICICI Bank down by 4.83%, Ultratech Cement down by 3.99% and Yes Bank down by 3.67% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 slipped 124.56 points or 0.6% to 20,649.00, Hang Seng decreased 44.95 points or 0.16% to 27,524.24, Jakarta Composite dropped 21.22 points or 0.33% to 6,461.62, Shanghai Composite declined 4.21 points or 0.16% to 2,597.51, Straits Times trembled 2.34 points or 0.07% to 3,199.91 and KOSPI was down by 0.43 points or 0.02% to 2,177.30.

On the other side, Taiwan Weighted was up by 43.72 points or 0.44% to 10,013.33.