Local equities trim some initial gains

Local equity benchmarks trimmed some of their initial gains in morning session but managed to remain in green territory. Power, Utilities and Auto counters witnessed notable losses, while Energy, BANKEX and Metal sectors edged higher. Traders reacted negatively to Reserve Bank of India’s (RBI) report that private corporate investment plans have fallen for the seventh year in a row on account of economic slowdown, poor project appraisals and huge corporate leveraging.  However, the downfall was arrested on a report that RBI will inject long-term liquidity worth $5 billion into the system through foreign exchange swap arrangement with banks for three years, in order to meet the durable liquidity needs of the system. Besides, ICRA in its report stated that Small finance banks (SFBS) are likely to grow at 25-30 percent over the medium-term and if they can arrange additional external capital of Rs 4,000-6,000 crore till FY23.

On the global front, Asian markets were trading mostly in red, as investors awaited data from China for clues about the health of the world's second largest economy, while the pound shot up to near nine-month highs as the risk of a no-deal BREXIT receded following a late-night vote. Back home, RBI has relaxed norms for imports of capital and non-capital goods by raising the trade credit limit to $150 million under the automatic route.

The BSE Sensex is currently trading at 37782.78, up by 30.61 points or 0.08% after trading in a range of 37737.31 and 37907.78. There were 19 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index slipped 0.24%, while Small cap index was down by 0.09%.

The top gaining sectoral indices on the BSE were Energy up by 0.58%, Metal up by 0.27%, BANKEX up by 0.20%, Oil & Gas up by 0.17%, Telecom up by 0.16%, while Power down by 1.12%, Utilities down by 0.93%, Consumer Durables down by 0.74%, Auto down by 0.74%, Basic Materials down by 0.54% were the top losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 2.80%, IndusInd Bank up by 2.19%, Coal India up by 1.40%, Asian Paints up by 0.99% and Axis Bank was up by 0.81%. On the flip side, Power Grid down by 3.26%, Hero MotoCorp down by 1.82%, HCL Tech down by 1.15%, Bajaj Auto down by 1.07% and Bajaj Finance was down by 0.88% were the top losers.

Meanwhile, the Federation of Automobile Dealers Associations (FADA) has released its data on the total automobile sales for February 2019. It highlighted that retail sales of passenger vehicles (PVs) in February declined by 8.25% to 2,15,276 units as compared to 2,34,632 units in February 2018, hit by lower offtake by end customers. Two-wheeler sales declined by 7.97% to 11,25,405 units last month as compared with 12,22,883 units in the year-ago period.

It further mentioned that retail sales of commercial vehicles (CVs) during last month declined by 7.08% to 61,134 units as compared with 65,789 units in February 2018.Three-wheeler sales also declined by 10.32% in February at 50,263 units, as compared with 56,045 units in the year-ago period. Total automobile sales during February declined by 8.06 per cent to 14,52,078 units as compared with 15,79,349 units in February 2018.

FADA President Ashish Harsharaj Kale said after a month of spike in PVs sales in January which was largely due to year-end stock clearance getting extended and few new launches which generated some excitement, the industry is once again witnessing downward trend as February turned out to be one of the slowest month for auto retail during this financial year. He added domestic auto sales are experiencing a prolonged slowdown as it is already been six months of downturn with no positive triggers visible in near term. Moreover, he highlighted that inventory levels across all categories reached an unsustainable high and at alarming levels in two-wheelers.

The CNX Nifty is currently trading at 11346.15, up by 4.45 points or 0.04% after trading in a range of 11329.25 and 11383.45. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Yes Bank up by 2.82%, Indiabulls Housing Finance up by 2.34%, IndusInd Bank up by 2.24%, Zee Entertainment up by 1.40% and Coal India was up by 1.32%. On the flip side, Power Grid down by 3.34%, Ultratech Cement down by 1.93%, Hero MotoCorp down by 1.67%, Adani Ports down by 1.27% and HPCL was down by 1.25% were the top losers.

Asian markets were trading mostly in red; Shanghai Composite declined 32.89 points or 1.09% to 2,994.06, Hang Seng decreased 24.88 points or 0.09% to 28,782.57, Taiwan Weighted dropped 23.13 points or 0.22% to 10,350.19, Straits Times trembled 5.78 points or 0.18% to 3,189.81 and KOSPI was down by 4.68 points or 0.22% to 2,143.73.

On the other side, Jakarta Composite soared 9.57 points or 0.15% to 6,387.15 and Nikkei 225 was up by 33.83 points or 0.16% to 21,324.07.