Benchmarks trade lower tailing sluggish global cues

Indian equity indices have made a choppy start on Friday’s trade following sluggish trend in global markets. The US markets closed lower overnight after disappointing US economic reports emerged and on sluggish progress in fixing Europe’s debt crisis. The sentiments also turned pessimistic after Federal Reserve official threw cold water on the notion that another round of stimulus is on its way. While, Asian markets too exhibited the sluggish trend with Chinese market losing over half a percent on the back of weak PMI data and a report that the government is studying further measures to strengthen its control of the property market. Back home, the sentiments turned down on RBI’s comment that lower interest rates alone won’t pull the economy out of malaise. All the sectoral indices on the BSE traded lower. Realty, auto, consumer durables, metal and power space were witnessing the selling pressure in early trade. However, PSU oil marketing companies like BPCL, HPCL and IOC all edged higher in the trade on talks that OMCs are putting pressure on the government for a hike as Indian basket of crude oil increased by over $10 to $113 per barrel since last revision and the petrol prices are expected to go up by around Rs 3 a litre after the monsoon session of Parliament ends in the first week of September. Moreover, the broader indices too were struggling to get some traction and the market breadth on the BSE was negative; there were 571 shares on the gaining side against 862 shares on the losing side while 50 shares remained unchanged. 

The BSE Sensex opened at 17,790.25; about 60 points lower compared to its previous closing of 17,850.22, and has touched a low of 17,822.50 and 17,741.54 respectively.

The index is currently trading at 17,755.08 down by 95.14 points or 0.53%. There were 8 stocks advancing against 22 declines on the index.

The overall market breadth has made a negative start with 38.50% stocks advancing against 58.13% declines. The broader indices too were trading in the red; the BSE Mid cap and Small cap indices declined 0.61% and 0.34% respectively.

The major losing sectoral indices on the BSE were, Realty down by 1.12%, Auto down by 0.92%, CD down by 0.84%, Metal down by 0.84% and Power down by 0.83%, while there were no gainers on the index.

The top gainers on the Sensex were Coal India up by 1.00%, ONGC up by 0.82%, BHEL up by 0.32%, Hero MotoCorp up by 0.31% and GAIL up by 0.30%.

On the flip side, M&M was down by 2.09%, Hindalco was down by 1.46%, Jindal Steel was down by 1.44%, Tata Steel was down by 1.44% and Sterlite Industries was down by 1.39% were the top losers on the Sensex.

Meanwhile, after the recent announcements in annual supplement of the Foreign Trade Policy (FTP), the Centre has revised the apparel exports target to $18 billion, about Rs 99,000 crore from $17 billion, about Rs 93,500 crore for the fiscal 2012-13. The market-linked focus product scheme for apparel exports to US and European Union also has been extended till the end of the current fiscal. Also, the sops included interest subvention on pre-shipment credit.

The US and Europe together account for over 65 per cent of the country's total textiles exports. During 2011-12, India’s apparel exports grew about 18% year-on-year to $13.6 billion, while the government has fixed a $40 billion target for the entire textiles sector in the current fiscal.

Minister of State for Textiles Panabaaka Lakshmi has confirmed that the government has recommended continuation of the Technology Upgradation Fund Scheme (TUFS) with an allocation of Rs 15,886 crore for the entire 12th Plan (2012-17), which is applicable for all the sectors including power-loom small scale industry.

The S&P CNX Nifty opened at 5,392.60; about 27 points lower compared to its previous closing of 5,415.35, and has touched a high and a low of 5,399.65 and 5,376.80 respectively.

The index is currently trading at 5,380.80, lower by 34.55 points or 0.64%. There were only 6 stocks advancing against 44 declines on the index.

The top gainers of the Nifty were Coal India up by 1.16%, ONGC up by 0.53%, Cipla up by 0.19%, Wipro up by 0.17% and HDFC up by 0.13%.

On the flip side, RInfra down by 2.07%, M&M down by 1.96%, IDFC down by 1.61%, Jindal Steel down by 1.56% and JP Associates down by 1.55%, were the major losers on the index.

All the Asian equity indices were trading in the red; Shanghai Composite was down by 15.83 points or 0.75% to 2,097.25, Hang Seng slumped by 234.32 points or 1.16% to 19,897.92, Jakarta Composite declined by 20.35 points or 0.49% to 4,140.04, KLSE Composite was marginally down by 1.47 points or 0.09% to 1,650.05, Nikkei 225 declined by 100.94 points or 1.10% to 9,077.18, Straits Times was lower by 9.80 points or 0.30% to 3,047.43, Kospi Composite was down by 20.40 points or 1.14% to 1,922.29 and Taiwan Weighted has lost 25.27 points or 0.34% to 7,479.89.