Markets trim losses in early noon deals

Indian equity benchmarks trimmed their losses in early noon session, but continue to trade below the neutral lines with Sensex and Nifty trading below its crucial 38,600 and 11,550 respectively. Weak broader indices along with sell off at Consumer Durables, Consumer Discretionary and IT counters, dragged the markets lower. Anxiety remained on the street with CARE Ratings’ report that economic slowdown has begun to dent the credit profile of India Inc. There has been a deterioration in the credit quality of entities rated in the first quarter of the current financial year, showing effect of the prevailing slowdown in the Indian economy. Further losses were restricted, as some support came in as government has expressed confidence that the deficit in kharif sowing will be covered by the end of the month after rains rebounded in many parts in the past few days.

On the global front, Asian market were trading mostly in red as investors awaited signs of what might be ahead for U.S. interest rates. Back on street, in scrip specific developments, shares of Titan edged lower as company has reported a lower-than-expected growth in jewellery business during April-June quarter (Q1FY20) owing to a tough macro-economic environment with consumption taking a hit. Besides, SPARC climbed on getting Orphan Drug Designation from USFDA.

The BSE Sensex is currently trading at 38553.83, down by 166.74 points or 0.43% after trading in a range of 38435.87 and 38754.47. There were 16 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 0.18%, while Small cap index was down by 0.07%.

The top gaining sectoral indices on the BSE were Realty up by 1.69%, Healthcare up by 1.42%, Energy up by 1.41%, Oil & Gas up by 0.98% and PSU was up by 0.69%, while Consumer Durables down by 6.66%, Consumer Discretionary down by 1.28%, IT down by 0.98%, TECK down by 0.91%, and FMCG was down by 0.81% were the losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 4.88%, Yes Bank up by 2.58%, Reliance Industries up by 1.53%, Bajaj Finance up by 1.18% and ONGC was up by 1.18%. On the flip side, Asian Paints down by 3.04%, HDFC down by 2.48%, TCS down by 2.15%, Kotak Mahindra Bank down by 1.63% and ITC was down by 1.21% were the top losers.

Meanwhile, former finance minister P Chidambaram has said that the Union Budget for 2019-20 is ‘status-quoist’ as it seeks to generate only incremental reforms and not radical reforms needed by the country to grow more quick. He pointed out that the budget does not have any structural reforms, and if there are no structural reforms, it appears that they want to carry on with the existing policies and reforms and yet achieve that kind of growth that this government envisages. He added that there is nothing in the budget to take care of the 20 percent poorest of the poor.

Chidambaram said Dr Manmohan Singh brought radical reforms, ‘when we tore up the red book, when we abolished licencing overnight and when we got rid of foreign exchange control and that despicable era. Those were radical reforms. I can't see any radical reforms in this budget. Thus, our country, our economy will remain status quo for one more year.' He also said except the corporate tax, every other number in this budget is suspect and every number is not credible. He added that the amount of Rs 70,000 crore is ‘totally insufficient’ for recapitalization of banks.

Talking on the great promise of making India a $5-trillion economy by 2024, Former finance minister said 'We will become a five-trillion-dollar economy by 2024 and they would achieve this promise made. But I can also make happen my promise of turning India into a 10-trillion-dollar economy in the next five years of 2024.’ He also said ‘When we do radical reforms, we can see rapid growth’. He noted that the country needs to grow rapidly to ensure that there is enough investment to improve the state of education and health facilities in the country.

The CNX Nifty is currently trading at 11501.25, down by 57.35 points or 0.50% after trading in a range of 11461.00 and 11537.55. There were 25 stocks advancing against 25 stocks declining on the index.

The top gainers on Nifty were Sun Pharma up by 5.55%, Indian Oil Corporation up by 4.03%, Yes Bank up by 2.68%, Cipla up by 2.18% and Reliance Industries was up by 1.52%. On the flip side, Titan Company down by 12.69%, UPL down by 3.98%, Asian Paints down by 3.01%, HDFC down by 2.31% and Hindalco was down by 2.18% were the top losers.

Asian markets were trading mostly in red; KOSPI fell 7.30 points or 0.35% to 2,056.87, Taiwan Weighted dropped 48.44 points or 0.45% to 10,702.78, Hang Seng decreased 205.48 points or 0.73% to 28,126.21 and Shanghai Composite was down by 14.57 points or 0.5% to 2,918.79.

On the flip side, Straits Times advanced 2.15 points or 0.06% to 3,336.38, Nikkei 225 surged 11.49 points or 0.05% to 21,545.84 and Jakarta Composite was up by 17.24 points or 0.27% to 6,369.07.