Weak trade continues on Dalal Street

Indian equity benchmarks continued their weak trade in afternoon deals, as Telecom, Metal and Utilities stocks retreated. The mood of the markets remain impacted with Moody's Investors Service report that the Indian government will find it difficult to meet the fiscal deficit target of 3.4% in 2019-20 (FY20). Observing that government's debt is ‘stubbornly high’ as a percentage of Gross Domestic Product (GDP). Domestic sentiment was also weakened with private report stating that public sector investments are expected to grow at a much slower pace in 2019-20, as capital outlay by public sector enterprises is expected to remain at almost the same level as 2018-19, while capital spending by the Centre is budgeted to grow at a much slower pace next year. Traders also took a note of report that as many as 363 infrastructure projects, each worth Rs 150 crore or more, have shown cost overruns to the tune of over Rs 3.42 trillion owing to delays and other reasons.

On the global front, Asian markets were trading mostly in green, as investors were cheered by a blockbuster US jobs report last week, while trade was thin owing to the three-day Lunar New Year break. Back home, the BSE Sensex is currently trading at 36338.09, down by 131.34 points or 0.36% after trading in a range of 36273.67 and 36456.22. There were 9 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.82%, while Small cap index was down by 0.95%.

The few gaining sectoral indices on the BSE were Consumer Durables up by 1.48%, Energy up by 0.64% and Oil & Gas up by 0.06%, while Telecom down by 2.23%, Metal down by 1.89%, Utilities down by 1.48%, Power down by 1.40% and Basic Materials down by 1.40% were the top losing indices on BSE.

The top gainers on the Sensex were ONGC up by 2.96%, Bajaj Auto up by 2.27%, Reliance Industries up by 1.06%, Hindustan Unilever up by 0.56% and TCS up by 0.36%. On the flip side, Tata Steel down by 3.78%, Yes Bank down by 2.64%, Indusind Bank down by 2.58%, Mahindra & Mahindra down by 2.32% and Bharti Airtel down by 1.96% were the top losers.

Meanwhile, Economic Affairs Secretary Subhash Chandra Garg has said that the government would start disbursing substantial amount under the ‘Pradhan Mantri Kisan Samman Nidhi’ (PM-KISAN) scheme for small farmers in February itself as beneficiary data is already in place. He also said that in the interim budget 2019-20, the government announced transfer of Rs 6,000 per year to 12 crore farmers holding cultivable land up to 2 hectare directly into their bank accounts from this year itself. Besides, the government has already earmarked Rs 20,000 crore for disbursal among 12 crore farmers under the scheme in 2018-19.

Garg informed said that the government last year released Agriculture Census 2015-16 and most states have moved to electronic record-keeping. He also said that the work which the agriculture department now would be doing is to relate these holdings to the families which will receive the assistance. He said “they are very confident that they will do with the state governments very soon and they expect to make disbursements of substantial amount in the month of February itself. That is the expectation and confidence of the (agri) department.”

Economic Affairs Secretary further said that supplementaries would be presented in the current session to seek Parliament’s nod for spending additional Rs 20,000 crore for the scheme. He also said that the ongoing budget session is scheduled to conclude on February 13. Besides, he stated that the PM-KISAN scheme has been approved by the Cabinet and therefore the necessary approval for the administrative department to implement the scheme is also available. Emphasizing that agriculture department has already done the spadework, he said the 12 crore beneficiary number has been arrived at with the help of Agriculture Census Data 2015-16.

The CNX Nifty is currently trading at 10851.60, down by 42.05 points or 0.39% after trading in a range of 10829.90 and 10878.75. There were 11 stocks advancing against 39 stocks declining on the index.

The top gainers on Nifty were Titan Co up by 4.49%, Eicher Motors up by 3.53%, ONGC up by 3.10%, Bajaj Auto up by 2.19% and Reliance Industries up by 0.87%. On the flip side, Tata Steel down by 4.04%, Hindalco down by 3.07%, Yes Bank down by 2.72%, HPCL down by 2.56% and Indusind Bank down by 2.39% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 95.38 points or 0.46% to 20,883.77, Hang Seng increased 59.47 points or 0.21% to 27,990.21 and Shanghai Composite gained 33.66 points or 1.3% to 2,618.23.

On the flip side, Straits Times trembled 4.12 points or 0.13% to 3,184.56 and Jakarta Composite dropped 46.63 points or 0.71% to 6,492.01.