Local equities continue negative trend; Telecom, Auto drag

Tracking weak global cues, local equity benchmarks continued to show a negative trend in morning session, Nifty trading below its crucial 11,250 mark. Telecom, Auto and Metal counters witnessed notable losses, while BANKEX and IT sectors edged higher. Traders took note of Reserve Bank of India governor Shaktikanta Das’ statement that charges of currency manipulation made by one country against another smacks of ‘bilateral hegemony’ and asserted that ensuring orderly exchange rates was the responsibility of multilateral institutions like the IMF and not individual nations. However, losses remain capped with Finance Minister Nirmala Sitharaman’s statement the government of India is working on various fronts to spur the economy starting with improving people’s income or in other words pushing more money into their hands particularly those living in the rural parts of the country in order to boost consumption. Besides, home minister Amit Shah stated that the path to achieve the country’s target of being a $5 trillion economy passes through Uttar Pradesh.

On the global front, Asian markets were trading mostly lower as US-China negotiations to resume in Beijing later this week amid low expectations for a major breakthrough. Back home, the GST Council on July 27 has cut rates on electric vehicles (EVs) to 5% from 12% in a move that is expected to align indirect tax structure on such vehicles with the government’s overall push to incentivise manufacturing of non-fossil fuels transport. Besides, a report stated that despite the continuing slowdown in the real estate sector driven mainly by various regulatory changes, the industry saw amongst $2.7 billion flowing into the market in the first half of 2019.

The BSE Sensex is currently trading at 37801.66, down by 81.13 points or 0.21% after trading in a range of 37754.21 and 38043.22. There were 8 stocks advancing against 23 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index slipped 0.70%, while Small cap index was down by 0.61%.

The few gaining sectoral indices on the BSE were IT up by 0.61%, BANKEX up by 0.54%, TECK up by 0.03%, while Telecom down by 3.59%, Auto down by 2.86%, Metal down by 2.36%, Basic Materials down by 1.82% and Capital Goods was down by 1.39% were the top losing indices on BSE.

The top gainers on the Sensex were ICICI Bank up by 4.21%, HCL Technologies up by 1.09%, Tech Mahindra up by 1.07%, TCS up by 0.85% and Infosys was up by 0.71%. On the flip side, Tata Motors down by 5.06%, Tata Motors - DVR down by 4.87%, Bajaj Auto down by 4.61%, Vedanta down by 4.15% and Yes Bank was down by 3.75% were the top losers.

Meanwhile, the Federation of Indian Chambers of Commerce and Industry (FICCI) and Vestian in their report have said that real estate sector got $2.7 billion fund inflows in first half of 2019, despite the continuing slowdown in the sector driven mainly by various regulatory changes. Improvement in infrastructure, roads, and the metro networks coupled with the increased speed of technology implementation can further boost investor interest.

The report mentioned that the momentum of investment in the realty sector between 2015 and 2018 continued in the first half of 2019, with nearly $2.7 billion flowing in. Between 2015 and 2018, fund inflows stood touched $25.7 billion. It further highlighted that one of the major trends observed in the last decade has been the rise in institutional investment in real estate, particularly PE investments that has been a key factor in keeping the market confident about its revival. It added nearly 80 percent of institutional investments are accounted for by PE investors.

With 50% of total investments, commercial assets has seen highest amount of investments. The investment value in the segment was recorded at $14.2 billion during 2015-18, depicting several large-scale deals. This was followed by warehousing and logistics sector. Moreover, it noted that despite occupying the least share, investment into industrial assets, mainly comprising warehousing and logistics sector, has observed considerable interest in 2018 and 2019.

The CNX Nifty is currently trading at 11238.25, down by 46.05 points or 0.41% after trading in a range of 11224.90 and 11310.95. There were 10 stocks advancing against 40 stocks declining on the index.

The top gainers on Nifty were ICICI Bank up by 4.13%, HCL Technologies up by 1.05%, TCS up by 0.84%, Infosys up by 0.76% and IndusInd Bank was up by 0.60%. On the flip side, Indiabulls Housing Finance down by 7.75%, Tata Motors down by 5.03%, Bajaj Auto down by 4.60%, Grasim Industries down by 4.30% and Vedanta was down by 4.20% were the top losers.

Asian markets were trading mostly lower; Hang Seng decreased 405.77 points or 1.43% to 27,991.97, Nikkei 225 slipped 87.82 points or 0.41% to 21,570.33, Jakarta Composite lost 39.07 points or 0.62% to 6,286.17, KOSPI fell 35.02 points or 1.69% to 2,031.24, Straits Times trembled 21.94 points or 0.65% to 3,341.82 and Shanghai Composite was down by 4.32 points or 0.15% to 2,940.22. On the other hand, Taiwan Weighted was up by 3.93 points or 0.04% to 10,895.91.