Markets keep heads above water

Key equity bourses were keeping their heads above water in late afternoon session, despite weak opening in European markets. Traders were positive, amid reports that the Ministry of Micro, Small and Medium Enterprises is organizing a programme on Technology Support and Outreach (TECH-SOP) in New Delhi.  The objective of the programme is to educate MSMEs and enhance their awareness about latest technological innovation available and sensitize them on the role of technology in creating competitiveness and opportunities.  The marker participants took a note of the commerce ministry’s statement that India and countries of the Latin American and Caribbean region have huge potential to boost economic ties in areas like agriculture, health, energy and information technology.

On the sectoral front, airlines stocks were trading mixed, even though Suresh Prabhu, Union Minister of Commerce, Industry and Civil Aviation has said that aviation sector has the potential to add to the growth of Indian economy.  However, agri stocks came under pressure, after the government said that India's foodgrains production is estimated to decline by one per cent to 281.37 million tonne in 2018-19 despite record rice output, as the country is likely to harvest lower coarse cereals and pulses crops. The country had produced 284.83 million tonne in the 2017-18 crop year (July-June).

On the global front, European markets were trading in red, as a measure of Switzerland's future economic performance declined for a fifth consecutive month in February and at a sharp rate, suggesting that the economy is set for some slowdown in the coming months. The figures from the Zurich-based KOF Swiss Economic Institute showed that the KOF Economic Barometer fell to 92.4 from January's 96.2, which was revised from 95 reported initially. Asian markets were also trading in red, as US-North Korea summit entered second day and a report showed China's manufacturing sector shrank in February for the third straight month. The official manufacturing PMI dropped to 49.2 in February from 49.5 in the previous month, as export orders fell to the lowest level since the global crisis. The non-manufacturing PMI came in with a score of 54.3 in February - shy of expectations for 54.5 and down from 54.7 in the previous month.

The BSE Sensex is currently trading at 35976.56, up by 71.13 points or 0.20% after trading in a range of 35845.75 and 36085.85. There were 23 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.42%, while Small cap index was up by 0.75%.

The top gaining sectoral indices on the BSE were Metal up by 1.27%, Utilities up by 1.22%, PSU up by 1.14%, Energy up by 1.10% and Oil & Gas up by 1.05%, while IT down by 0.53%, TECK down by 0.45% and Auto down by 0.22% were the few losing indices on BSE.

The top gainers on the Sensex were Vedanta up by 2.92%, Coal India up by 2.67%, NTPC up by 1.62%, Yes Bank up by 1.45% and Tata Motors up by 1.44%. On the flip side, TCS down by 2.44%, Hero MotoCorp down by 1.30%, Axis Bank down by 0.98%, Mahindra & Mahindra down by 0.74% and Tata Motors - DVR down by 0.74% were the top losers.

Meanwhile, credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has said that borrowing from the National Small Savings Fund (NSSF) runs the risk of understating the fiscal deficit number, noting that the Government has borrowed an additional Rs 500 billion from the NSSF to take its total dependence on this route to Rs 1,420 billion or 22.4 percent of the budgeted fiscal deficit in FY19.

However, the rating agency said there can be positives as well through the excess borrowings from NSSF, especially easing pressure on the benchmark 10-yr G-sec yield and keeping the cost of government borrowings through extra budgetary resources (EBR) low.

On the economic growth front, the rating agency estimated weakness in the economic growth performance in Q3FY19. GDP growth in Q3FY19 is likely to have been affected by the base effect of Q3FY18, which is being reflected in the heat map of the economy. Ind-Ra said that Q3FY19 growth is expected to slow down to 6.9%.

The CNX Nifty is currently trading at 10830.65, up by 24.00 points or 0.22% after trading in a range of 10788.10 and 10865.70. There were 34 stocks advancing against 15 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Vedanta up by 3.13%, Coal India up by 2.87%, Indian Oil Corporation up by 2.09%, NTPC up by 1.87% and GAIL India up by 1.85%. On the flip side, TCS down by 2.66%, Eicher Motors down by 1.90%, Hero MotoCorp down by 1.55%, Indiabulls Housing Finance down by 1.22% and Axis Bank down by 1.04% were the top losers.

All Asian markets were trading in red; Jakarta Composite dropped 82.33 points or 1.26% to 6,443.35, Hang Seng decreased 132.42 points or 0.46% to 28,625.02, Straits Times trembled 22.40 points or 0.69% to 3,227.62, KOSPI fell 39.35 points or 1.76% to 2,195.44, Shanghai Composite declined 17.74 points or 0.6% to 2,936.08 and Nikkei 225 was down by 171.35 points or 0.79% to 21,385.16.

All European markets are trading in red; FTSE lost 54.97 points or 0.77% to 7,052.23, CAC fell 8.69 points or 0.17% to 5,216.66 and DAX was down by 38.60 points or 0.34% to 11,448.73.