Local equities continue flat trade with negative bias

Local equity benchmarks were trading flat with negative bias in morning session, tailing weak global cues. A level of pressure was seen on frontline stocks, especially Bajaj Finance, Asian Paints and Bajaj Auto. Some cautiousness came with a private report that India saw the largest migration of its high net worth individuals in 2018 after China and Russian Federation. India failed in creating a suitable environment for millionaires to stay back in the country which claims to be the fastest growing economy in the world. Traders took note of a report that amid a flare-up of trade war between the US and China, India expressed concerns about ‘existential challenges to the multilateral rules-based trading system’ represented by the World Trade Organization (WTO) due to unilateral tariff measures, imbalance in reforms agenda. However, losses remain arrested with a private report that the next global economic expansion would be dominated by Asia as most of the prominent economies of the continent would grow at nearly 7% in the coming years. India, Bangladesh, Vietnam, Myanmar and the Philippines would be among the five of the seven fastest-growing economies, with surges in per capita income throughout the 2020s.

On the global front, Asian markets were trading in red, following losses on Wall Street that came in response to China's hike in tariffs on $60 billion of US imports, ramping up tensions in a trade war between the global economic titans. Back home, energy investment has risen most rapidly in India in three years till 2018, up 12% to around $85 billion, the International Energy Agency (IEA). While global energy investment stabilised at near $1.85 trillion in 2018 after three years of decline. On the sectoral front, sugar stock were in focus, as a report stated that the country’s sugar exports surged to 21.29 lakh tonne so far in the current marketing year ending September, as against about five lakh tonnes shipped in the entire 2017-18. Out of the 21.29 lakh tonnes exported between October 1 and April 6, raw sugar accounted for 9.76 lakh tonnes.

The BSE Sensex is currently trading at 37052.02, down by 38.80 points or 0.10% after trading in a range of 36998.44 and 37146.58. There were 10 stocks advancing against 21 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index slipped 0.43%, while Small cap index was down by 0.67%.

The top gaining sectoral indices on the BSE were Energy up by 0.52%, BANKEX up by 0.20%, Oil & Gas up by 0.19%, FMCG up by 0.13% and Utilities was up by 0.11%, while Realty down by 1.48%, IT down by 1.02%, TECK down by 0.97%, Consumer Disc down by 0.94% and Auto was down by 0.84% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 3.14%, Vedanta up by 2.04%, IndusInd Bank up by 1.26%, ICICI Bank up by 1.21% and ITC was up by 1.10%. On the flip side, Bajaj Finance down by 2.44%, Bajaj Auto down by 2.09%, Asian Paints down by 2.08%, Tata Steel down by 1.69% and Hero MotoCorp was down by 1.05% were the top losers.

Meanwhile, Chief Economic Advisor (CEA) Krishnamurthy V. Subramanian has said  that the Indian economy would grow at 7% range in the current financial year (FY20) powered by the effects of the strong structural reforms such as bankruptcy laws, Goods and Services Tax (GST), crackdown on shell companies and the fiscal prudence undertaken in the last five years. He also stated that India would be able to maintain the fastest growing economy tag ahead of China. India still has significant potential and scope to grow strongly given the reforms that have been undertaken.

Talking about current economic slowdown, he said the effect of investments would manifest on economic growth with a lag and in an election year, there is wait-and- watch mode by corporates before undertaking fresh fund infusion into businesses. Moreover, he also said as an effect of the government’s recent measures, the current economic slowdown will gradually be replaced by higher investment and consumption going ahead.

Besides, the Indian economy grew at 6.6% in the December quarter, the slowest in five quarters, which prompted the government's Central Statistics Office (CSO) to trim its 2018-19 forecast to 7% from 7.2%. The Asian Development Bank (ADB), the Reserve Bank of India (RBI) and the International Monetary Fund (IMF) have cut India's Gross Domestic Product (GDP) growth forecast to 7.3% for FY20.

The CNX Nifty is currently trading at 11124.55, down by 23.65 points or 0.21% after trading in a range of 11109.20 and 11157.95. There were 14 stocks advancing against 35 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Sun Pharma up by 2.65%, Vedanta up by 2.04%, Adani Ports & SEZ up by 1.70%, GAIL India up by 1.61% and Indiabulls Housing Finance up by 1.43%. On the flip side, Bajaj Finance down by 2.44%, Bajaj Auto down by 2.28%, Tata Steel down by 2.01%, Eicher Motors down by 1.98% and Asian Paints down by 1.94% were the top losers.

All Asian markets were trading in red; Hang Seng decreased 452.48 points or 1.58% to 28,097.76, Nikkei 225 slipped 156.68 points or 0.74% to 21,034.60, Jakarta Composite lost 73.50 points or 1.2% to 6,061.90, Taiwan Weighted dropped 35.13 points or 0.33% to 10,523.16, Straits Times trembled 27.63 points or 0.85% to 3,206.65, Shanghai Composite declined 10.36 points or 0.36% to 2,893.35 and KOSPI was down by 0.70 points or 0.03% to 2,078.31.