Benchmarks trade flat in early noon session

Indian equity markets traded mixed in early noon session, with Sensex gaining 42 points, while Nifty was down by 2 points. Telecom, FMCG and IT stocks were amongst the top gainers on the BSE sectoral space. Selling in frontline blue chip stocks such as Yes Bank, Sun Pharma and Larsen & Toubro restricted the markets to go up. Investors were getting relief with RBI’s data showing that the country’s foreign exchange reserves increased by $171.9 million to $418.687 billion in the week to May 3, mainly on account of a rise in foreign currency assets. In the previous week, the reserves had swelled by $4.368 billion to $418.515 billion, helped by the second dollar-rupee swap auction held on April 23. Traders took note of the Federation of Indian Chamber of Commerce and Industry’s (FICCI) ‘Quarterly Survey on Manufacturing' report which stated that the overall sentiment in the manufacturing sector remains optimistic as the proportion of respondents reporting higher output growth (around 54 percent) during the January-March 2018-19 (Q4FY19) remained the same as compared to Q3 (October-December) of 2018-19.

On the global front, Asian markets were trading in red on growing uncertainty over whether the United States and China will be able to reach a deal to end their trade war after Washington sharply hiked tariffs. Back on streets, on scrip specific development, Oberoi Realty edged up on reporting a rise of 8.98% in its net profit at Rs 155.76 crore for the quarter under review as compared to Rs 142.92 crore for the same quarter in the previous year.  However, Allahabad Bank fell on reporting a net loss of Rs 3,834.07 crore for the quarter ended March 31, 2019, against net loss of Rs 3,509.63 crore for the same quarter in the previous year.

The BSE Sensex is currently trading at 37505.23, up by 42.24 points or 0.11% after trading in a range of 37319.00 and 37583.57. There were 15 stocks advancing against 16 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 0.84%, while Small cap index was down by 0.87%.

The top gaining sectoral indices on the BSE were Telecom up by 1.00%, FMCG up by 0.76%, IT up by 0.65%, TECK up by 0.64% and Consumer Durables was up by 0.31%, while Capital Goods down by 1.63%, Healthcare down by 1.35%, Industrials down by 1.23%, Power down by 0.89% and Utilities was down by 0.82% were the losing indices on BSE.

The top gainers on the Sensex were ITC up by 1.39%, SBI up by 1.12%, Axis Bank up by 1.05%, HCL Technologies up by 0.87% and TCS was up by 0.83%. On the flip side, Yes Bank down by 3.99%, Sun Pharma down by 2.42%, Larsen & Toubro down by 2.16%, Tata Motors - DVR down by 2.07% and NTPC was down by 1.22% were the top losers.

Meanwhile, with slowdown in manufacturing sector, India industrial production measured by Index of Industrial Production (IIP) contracted to 0.1% in March 2019, the lowest in 21 months. It had grown by 5.3% in March 2018. IIP's previous low was recorded in June 2017, when output shrank by 0.3%. As per the data released by the Central Statistics Office of the Ministry of Statistics and Programme Implementation, IIP with base 2011-12 for the month of March 2019 stood at 140.2, which is 0.1% lower as compared to the level in the month of March 2018. The cumulative growth for the period April-March 2018-19 over the corresponding period of the previous year stood at 3.6% as against 4.4 per cent in the previous fiscal. Meanwhile, IIP growth for February 2019 has been revised downwards to 0.07% from 0.1% earlier.

On the sectoral front, the manufacturing sector, which constitutes 77.63% of the IIP, contracted by 0.4% in March as compared to 5.7% expansion in the year-ago month. Power sector growth slowed to 2.2% in March as compared to 5.9% a year ago. Mining sector growth also dropped to 0.8% in March compared to 3.1% expansion a year ago. The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of March 2019 stand at 132.6, 139.6 and 160.1 respectively. The cumulative growth in these three sectors during April-March 2018-19 over the corresponding period of 2017-18 has been 2.9%, 3.5% and 5.2%, respectively.

Besides, capital goods output declined by 8.7% in the month under review as against 3.1% contraction in March 2018. As per use-based classification, growth rates in March 2019 were 2.5% in primary goods, (-) 2.5% in intermediate goods and 6.4% in infrastructure/ construction goods. Similarly, consumer durables and consumer non-durables have recorded growth of (-) 5.1% and 0.3%, respectively.

In terms of industries, 12 out of the 23 industry groups in the manufacturing sector have shown negative growth during the month of March 2019 as compared to the corresponding month of the previous year. The industry group ‘Manufacture of furniture’ has shown the highest negative growth of (-) 24.6% followed by (-) 18.5% in ‘Manufacture of other transport equipment’ and (-) 15.3 in ‘Manufacture of fabricated metal products, except machinery and equipment’. On the other hand, the industry group ‘Manufacture of tobacco products’ has shown the highest positive growth of 13.5% followed by 10.6% in ‘Manufacture of computer, electronic and optical products’ and 9.3% in ‘Manufacture of wood and products of wood and cork, except furniture; manufacture of articles of straw and plaiting materials’.

The CNX Nifty is currently trading at 11276.90, down by 2.00 points or 0.02% after trading in a range of 11230.70 and 11300.20. There were 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Bharti Infratel up by 2.10%, Tech Mahindra up by 1.64%, ITC up by 1.33%, Titan Company up by 1.31% and SBI was up by 1.23%. On the flip side, Eicher Motors down by 5.41%, Yes Bank down by 4.18%, Indiabulls Housing down by 3.27%, Sun Pharma down by 2.43% and Larsen & Toubro was down by 2.08% were the top losers.

Asian markets were trading in red; Nikkei 225 slipped 164.87 points or 0.77% to 21,180.05, Taiwan Weighted dropped 154.45 points or 1.42% to 10,558.54, Jakarta Composite lost 14.76 points or 0.24% to 6,194.36, KOSPI fell 23.57 points or 1.12% to 2,084.47, Straits Times trembled 39.47 points or 1.21% to 3,234.03 and Shanghai Composite declined 35.01 points or 1.19% to 2,904.23.