Benchmarks continue to trade in negative terrain in early noon session

Indian bourses extended their losses and were trading lower with cut of over a percent in early noon session as Government’s report which showed that the growth of eight core sectors slowed down to 2.1% in July as against 7.3% in the corresponding month last year. The decline was seen on account of heavy fall in coal and refinery industry. Besides, broader indices were also trading in red. Sentiments got undermined with the report that India’s sluggish growth momentum has dampened demand, capital expenditure and export outlook of companies, and the future recovery cycle will be ‘elongated and below market expectations. The street remained negative with the report that India's economic growth has slumped for the fifth straight quarter to an over six-year low of 5% in the first three months (April-June) of current fiscal year (Q1FY20). The growth slumped as consumer demand and private investment slowed amid deteriorating global environment.

On the global front, Asian markets were trading mostly in red at this point of time, while the Chinese yuan briefly dipped to historically low levels in offshore trading. Back home, agriculture stocks remained in focus after Crisil Research in its Agriculture Report 2019 stating that Farmers' profit from kharif crops this year could shrink to 10-12% from 37% a year ago, mainly on account of lower production. Shares of oil marketing companies (OMCs) such as Indian Oil Corporation (IOCL), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) edged lower after reports said the government may sell its entire stake worth a little more than Rs 40,000 crore in BPCL to IOCL.

The BSE Sensex is currently trading at 36914.21, down by 418.58 points or 1.12% after trading in a range of 36849.56 and 37188.38. There were 7 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index declined 0.81%, while Small cap index was down by 0.43%.

The few gaining sectoral indices on the BSE were IT up by 0.93%, TECK up by 0.65% and Healthcare was up by 0.18%, while Consumer Durables down by 1.80%, PSU down by 1.70%, Bankex down by 1.67%, Metal down by 1.65% and Power was down by 1.59% were the top losing indices on BSE.

The top gainers on the Sensex were Tech Mahindra up by 2.44%, Yes Bank up by 2.02%, HCL Tech up by 1.98%, TCS up by 1.32% and Infosys up by 0.79%. On the flip side, Tata Motors down by 3.21%, ICICI Bank down by 3.02%, Tata Steel down by 2.83%, HDFC down by 2.65% and NTPC down by 2.63% were the top losers.

Meanwhile, the Controller General of Accounts (CGA) in its latest data has showed that the government's fiscal deficit or gap between expenditure and revenue touched Rs 5.47 lakh crore in the first four months (April-July) of the financial year 2019-20 (FY20), which is 77.8% of the Budget Estimate (BE). In absolute terms, the fiscal deficit was Rs 5, 47,605 crore at July-end. The fiscal deficit stood at 86.5% of 2018-19 BE in the year-ago period. The government estimates the fiscal deficit to be at Rs 7.03 lakh crore during 2019-20. It aims to restrict the deficit at 3.4% of the Gross Domestic Product in the current fiscal, same as the last fiscal.

The data showed that revenue receipts of the government during April-July, 2019-20 remained unchanged at 19.5% of the BE compared to the corresponding period last year. In absolute terms, revenue receipts stood at Rs 3.82 lakh crore at July-end 2019. During the entire year, the revenue receipts has been pegged at Rs 19.62 lakh crore.

On the expenditure front, the capital expenditure was 31.8% of the BE. This compares with 37.1% in the year-ago period. Total expenditure during April-July period stood at Rs 9.47 lakh crore or 34% of the BE. It was 36.4% of BE in the corresponding period last fiscal.  The government has pegged its total expenditure during the fiscal ending March 2020 at Rs 27.86 lakh crore. The CGA further said the fiscal deficit figure in monthly accounts during a financial year is not necessarily an indicator of fiscal deficit for the year.

The CNX Nifty is currently trading at 10906.55, down by 116.70 points or 1.06% after trading in a range of 10878.40 and 10967.50. There were 12 stocks advancing against 38 stocks declining on the index.

The top gainers on Nifty were Tech Mahindra up by 2.60%, Bharti Infratel up by 1.88%, HCL Tech up by 1.84%, Yes Bank up by 1.58% and Britannia up by 1.10%. On the flip side, Ultratech Cement down by 3.31%, Indian Oil Corporation down by 2.90%, Tata Motors down by 2.87%, ICICI Bank down by 2.76% and Titan Company down by 2.73% were the top losers.

Asian markets were trading mostly in red; Hang Seng slipped 73.72 points or 0.29% to 25,552.83, Taiwan Weighted tumbled 76.64 points or 0.72% to 10,558.21, KOSPI decreased 5.22 points or 0.27% to 1,963.97, Jakarta Composite slipped 11.78 points or 0.19% to 6,278.77 and Shanghai Composite declined 6.97 points or 0.24% to 2,917.14. On the flip side, Nikkei 225 gained 4.97 points or 0.02% to 20,625.16 and Straits Times was up by 3.72 points or 0.12% to 3,086.68.