Benchmarks trim losses in noon deals

Indian equity benchmarks trimmed most of their losses in noon session, but continued to trade below the neutral lines, mirroring depressed sentiments of other Asian markets. Weak broader indices along with sell off at Realty, Telecom and TECK counters dragged the markets lower. Sentiments remain undermined with a private report that despite the policymakers’ efforts to revive the sagging growth momentum, the economy is set to print in a 5.7 percent uptick in the June quarter and is likely to bottom out from there. However, downside remained capped as India received the foreign direct investments (FDI) inflow of $64.37 billion during the financial year 2018-19 (FY19). According to the Annual Report 2018-19 of the Department for Promotion of Industry and Internal Trade (DPIIT), FDI worth $286 billion were received in the country in past five years. Meanwhile, Goods and Services Tax Network (GSTN) released trial version of offline tools of GST forms related to supply of goods and services. The offline tools have been released for Annexure of supplies (GST ANX-1) and Annexure of Inward Supplies (GST ANX-2), GSTN, which is the IT backbone of the indirect tax regime.

On the global front, Asian markets were trading lower, after US President Donald Trump criticized China, adding to worries over trade negotiations that resumed recently in Shanghai. Back on street, in scrip specific developments, shares of DHFL were under pressure on defaulting Rs 25 crore interest to NCD holders. However, Hero Motocorp edged up on reporting 36% surge in Q1 consolidated net profit.

The BSE Sensex is currently trading at 37308.81, down by 88.43 points or 0.24% after trading in a range of 37128.26 and 37349.71. There were 16 stocks advancing against 14 stocks declining, while 1 stock remain unchanged on the index.

The broader indices were trading in red; the BSE Mid cap index lost 0.33%, while Small cap index was down by 0.70%.

The top gaining sectoral indices on the BSE were Auto up by 1.15%, Metal up by 1.09%, Oil & Gas up by 0.58%, PSU up by 0.53% and Utilities up by 0.46%, while Realty down by 2.23%, Telecom down by 1.37%, TECK down by 0.84%, Consumer Durables down by 0.66% and IT was down by 0.58% were the top losing indices on BSE.

The top gainers on the Sensex were Hero MotoCorp up by 4.72%, Yes Bank up by 3.19%, Sun Pharma up by 2.66%, Indusind Bank up by 2.64% and Bajaj Auto was up by 2.63%. On the flip side, Axis Bank down by 3.73%, Tech Mahindra down by 3.47%, Bajaj Finance down by 1.84%, Bharti Airtel down by 1.53% and ITC was down by 0.71% were the top losers.

Meanwhile, making it more attractive and viable for corporates including non-banking financial companies (NBFCs) to raise cheaper offshore funds, the Reserve Bank of India (RBI) has further liberalised the norms related to external commercial borrowing (ECB) by relaxing the end-use restrictions with regard to working capital, general corporate purpose and repayment of rupee loans. The changes have been made after receiving feedback from stakeholders.

Accordingly, eligible borrowers will now be allowed to raise following ECBs from recognised lenders, except foreign branches and overseas subsidiaries of Indian banks, with a minimum average maturity period of 10 years for working capital purposes and general corporate purposes. Borrowing for on-lending by NBFCs for the above maturity and end-uses is also permitted. Borrowers will be also allowed to raise ECBs with a minimum average maturity period of 7 years for repayment of rupee loans availed domestically for capital expenditure.

For repayment of Rupee loans availed domestically for purposes other than capital expenditure and for on-lending by NBFCs for the same, the minimum average maturity period of the ECB would have to be 10 years. The central bank further decided to permit eligible corporate borrowers to avail ECB for repayment of rupee loans availed domestically for capital expenditure in manufacturing and infrastructure sector and classified as SMA - 2 (special mention account) or NPA, under any one-time settlement arrangement with lenders.

The CNX Nifty is currently trading at 11070.80, down by 14.60 points or 0.13% after trading in a range of 10999.40 and 11072.95. There were 27 stocks advancing against 22 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Hero MotoCorp up by 4.69%, Yes Bank up by 3.83%, Indusind Bank up by 2.81%, Sun Pharma up by 2.73% and Bajaj Auto was up by 2.47%. On the flip side, Zee Entertainment down by 5.54%, Tech Mahindra down by 3.48%, Axis Bank down by 3.46%, Bharti Infratel down by 2.68% and Britannia Industries was down by 1.80% were the top losers.

All Asian markets were trading in red; Hang Seng decreased 368.75 points or 1.31% to 27,777.75, Nikkei 225 slipped 187.78 points or 0.86% to 21,521.53, Straits Times trembled 24.11 points or 0.72% to 3,326.43, Jakarta Composite lost 16.36 points or 0.26% to 6,360.64, KOSPI fell 5.25 points or 0.26% to 2,033.43, Shanghai Composite declined 14.08 points or 0.48% to 2,938.26 and Taiwan Weighted was down by 7.09 points or 0.07% to 10,823.81.