Local equities extend losses in morning deals

Local equity benchmarks extended their losses in morning session with frontline gauges trading below their neutral lines owing to selling pressure in frontline blue-chip counters. Bharti Airtel, Coal India and Reliance Industries were the prime losers among heavy-weights, pushing Sensex 0.37% lower. Traders remained anxious with a report that volatile crude oil prices, a strong dollar and rising US bond yields has resulted in foreign institutional investors (FIIs) turning big sellers in the Indian market. Traders paid no heed to a report that the government is considering a relaxation in mandatory 30% local sourcing norm for foreign direct investment (FDI) in single-brand retail in a bid to draw companies such as Apple looking to set up their own stores in India. Besides, a report stated that the government has approved a three-year extension of the Credit Linked Capital Subsidy and Technology Up-gradation Scheme for MSMEs with total outlay of 2,900 crore. The scheme has been approved for continuation beyond the 12th five-year Plan for three years from 2017-18 to 2019-20.

On the global front, Asian markets were trading mostly in red, as investors hoped for progress in the latest Sino-US tariff talks while bracing for China trade data that are expected to show further falls in both exports and imports. Back home, on the sectoral front, banking stocks were in focus, as RBI’s report stated that both bank credit as well as deposits growth marginally declined on a fortnightly basis, clipping at 14.5 percent at Rs 94.29 lakh crore deposits grew at a tepid 9.63 percent to Rs 121.22 lakh crore for the fortnight ending February 1.

The BSE Sensex is currently trading at 35900.52, down by 133.59 points or 0.37% after trading in a range of 35873.55 and 36109.10. There were 9 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index slipped 0.25%, while Small cap index was down by 0.36%.

The gaining sectoral indices on the BSE were Auto up by 0.44%, BANKEX up by 0.19%, Industrials up by 0.17% and Consumer Disc was up by 0.05%, while Telecom down by 2.11%, Energy down by 1.56%, Metal down by 1.47%, Oil & Gas down by 1.43% and Consumer Durables was down by 1.06% were the top losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 21.92%, Hero MotoCorp up by 2.98%, Tata Motors up by 0.87%, Indusind Bank up by 0.87% and Bajaj Auto was up by 0.81%. On the flip side, Bharti Airtel down by 2.90%, Coal India down by 2.09%, NTPC down by 1.49%, Reliance Industries down by 1.47% and Kotak Mahindra Bank was down by 1.32% were the top losers.

Meanwhile, with an aim to improve competitiveness of Micro, Small and Medium Enterprises (MSMEs), the government has approved a three-year extension of the Credit Linked Capital Subsidy and Technology Up-gradation (CLCS-TUS) Scheme for MSMEs with total outlay of Rs 2,900 crore. The scheme has been approved for continuation beyond the 12th five-year Plan for three years from 2017-18 to 2019-20.

CLCS-TUS scheme will facilitate technology upgradation to MSMEs, improvement in quality of products, enhancement in productivity, reduction in waste, and it will promote a culture of continuous improvement. The objective of the scheme is to facilitate technology up-gradation in MSEs by providing an upfront capital subsidy of 15% (on institutional finance of up to Rs 1 crore availed by them) for induction of well-established and improved technology in the specified 51 sub-sectors/products approved.

Besides, under the scheme, special provisions have been made to promote entrepreneurship for SC/STs, women, hill states (Jammu & Kashmir, Himachal Pradesh & Uttarakhand), island territories (Andaman & Nicobar and Lakshadweep) and the aspirational districts/ LWE (Left-wing extremism) districts, as in these cases the subsidy will be admissible also for investment in acquisition /replacement of plant & machinery/equipment & technology up-gradation of any kind.
The CNX Nifty is currently trading at 10748.90, down by 44.75 points or 0.41% after trading in a range of 10737.30 and 10792.70. There were 16 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were Yes Bank up by 21.75%, Indiabulls Housing Finance up by 4.18%, Hero MotoCorp up by 2.97%, Zee Entertainment up by 2.78% and Adani Ports was up by 1.84%. On the flip side, HPCL down by 4.04%, Bharti Airtel down by 3.06%, Indian Oil Corp. down by 2.73%, BPCL down by 2.50% and Bharti Infratel was down by 2.32% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 110.14 points or 0.39% to 28,387.45, Shanghai Composite declined 8.64 points or 0.32% to 2,712.43, Jakarta Composite dropped 6.75 points or 0.11% to 6,412.37, KOSPI fell 3.57 points or 0.16% to 2,197.91 and Straits Times trembled 3.51 points or 0.11% to 3,241.26.

On the side flip, Taiwan Weighted strengthened 6.33 points or 0.06% to 10,096.91 and Nikkei 225 was up by 35.10 points or 0.17% to 21,179.58.