Key benchmark indices trade flat with negative bias

Key benchmark indices were trading flat with negative bias in afternoon session, on account of selling in frontline blue chip counters. Some concerns remained among the traders with Moody’s statement that the fresh round recapitalisation of 12 state-run banks is positive as it will help them improve their core capital but a complete turnaround is still away due to the large quantum of legacy bad loans. It said these banks are far from a complete turnaround as large volumes of problem-loans will still continue to cap improvements in profitability and capitalisation, constraining their credit profiles. However, losses were limited with Niti Aayog’s report that the host of reforms undertaken by the government has transformed India into the fastest-growing major economy along with the macroeconomic stability not witnessed in the past. On the sectoral front, auto sector stocks were in focus after India Ratings and Research (Ind-Ra) stated that India's overall automobile sales are likely to remain tepid in the first half of 2019-20, but the upcoming implementation of BS-VI emission norms will drive the demand in the second half of the year.

On the global front, Asian markets were trading mixed, tracking losses on Wall Street as optimism over the China-US trade talks was trumped by a weak round of US data that revived concerns about economic growth. Back home, the BSE Sensex is currently trading at 35861.26, down by 37.09 points or 0.10% after trading in a range of 35795.79 and 35938.52. There were 22 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.41%, while Small cap index was up by 0.80%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.34%, Auto up by 1.33%, Metal up by 1.31%, PSU up by 1.30% and Realty up by 1.28%, while Bankex down by 0.36%, Consumer Durables down by 0.32% and Energy down by 0.24% were the few losing indices on BSE.

The top gainers on the Sensex were Vedanta up by 2.83%, Yes Bank up by 2.12%, ONGC up by 1.94%, Mahindra & Mahindra up by 1.73% and Maruti Suzuki up by 1.71%. On the flip side, Kotak Mahindra Bank down by 3.37%, Reliance Industries down by 1.44%, HDFC Bank down by 0.85%, Asian Paints down by 0.81% and ITC down by 0.35% were the top losers.

Meanwhile, Labour Minister Santosh Gangwar has said that Employees' Provident Fund Organisation (EPFO) has increased the interest rate on provident fund (PF) deposits to 8.65 percent for the 2018-19 fiscal year as against 8.55 percent in the preceding year. The move, once approved by the finance ministry, will benefit 6 crore subscribers of the provident fund scheme.

The minister has stated that all members of the Central Board of Trustees (CBT) of EPFO agreed to give a higher interest for subscribers for 2018-19. He also noted that providing 8.65 percent interest rate for current financial year would leave the EPFO with a surplus of Rs 151 crore, compared to Rs 586 crore in 2017-18.

The EPFO had provided a five-year low rate of interest of 8.55 percent to its subscribers for FY18. The organisation had kept the interest rate at 8.65 per cent in FY17 and 8.8 percent in FY16. It provided 8.75 percent interest for FY14 as well as FY15. The rate of interest was 8.5 percent in FY13.\

The CNX Nifty is currently trading at 10789.55, down by 0.30 points after trading in a range of 10758.40 and 10798.95. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Indian Oil Corporation up by 4.88%, HPCL up by 4.06%, BPCL up by 2.89%, Indiabulls Housing Finance up by 2.88% and Vedanta up by 2.73%. On the flip side, Kotak Mahindra Bank down by 3.54%, Reliance Industries down by 1.34%, HDFC Bank down by 0.88%, Cipla down by 0.87% and Asian Paints down by 0.65% were the top losers.

Asian markets were trading mixed; Hang Seng increased 64.46 points or 0.23% to 28,694.38, Shanghai Composite gained 47.07 points or 1.71% to 2,798.87, Taiwan Weighted strengthened 3.39 points or 0.03% to 10,322.92 and KOSPI rose 1.84 points or 0.08% to 2,230.50. On the flip side, Straits Times trembled 7.34 points or 0.22% to 3,270.57, Nikkei 225 slipped 38.72 points or 0.18% to 21,425.51 and Jakarta Composite was down by 49.32 points or 0.75% to 6,488.45.