Benchmarks continue lackluster trade slightly in red

Indian equity benchmarks continued their lackluster trade slightly in red in afternoon session, despite positive signals from other Asian markets. Traders remained cautious with data showing that consumer price index-based inflation (CPI) for August crept up slightly to 3.21% year-on-year, compared with 3.15% in July, driven by a sharp rise in food prices. However, losses were limited as some optimism remained among the traders with Union Minister of Commerce & Industry and Railways Piyush Goyal’s statement that government will soon be coming out with a credit scheme for exporters with enhanced insurance cover upto 90 percent instead of the present 60 percent. On the sectoral front, Footwear stocks were in focus with Council for Leather Exports (CLE) stated that huge export opportunities are present in Russia for domestic leather and footwear industry. It said Russia has imported leather and footwear worth $3.9 billion in 2018, and India's exports to that country stood at only $52.6 million.

On the global front, Asian markets were trading in green following signs of hope for a thaw in the trade war between the U.S. and China. Back home, the BSE Sensex is currently trading at 37098.99, down by 5.29 points or 0.01% after trading in a range of 37000.09 and 37244.34. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.30%, while Small cap index was up by 0.33%.

The top gaining sectoral indices on the BSE were Realty up by 1.23%, Consumer Durables up by 1.18%, Auto up by 0.80%, Consumer Discretionary Goods & Services up by 0.61% and Power was up by 0.38%, while Telecom down by 0.85%, Healthcare down by 0.75%, Metal down by 0.43%, PSU down by 0.40% and Basic Materials was down by 0.15% were the top losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 1.47%, Hero MotoCorp up by 1.31%, Kotak Mahindra Bank up by 1.25%, ICICI Bank up by 1.01% and Bajaj Auto was up by 0.94%. On the flip side, Yes Bank down by 4.34%, Bharti Airtel down by 1.47%, Tata Steel down by 1.04%, SBI down by 0.98% and HDFC Bank was down by 0.78% were the top losers.

Meanwhile, expressing anxieties over fall in export credit, Commerce and Industry Minister Piyush Goyal said that the government will soon come up with the contours of a vibrant programme to address the issue, which will mainly support micro, small and medium enterprises (MSMEs). He said the programme, more importantly, will make foreign exchange credit available to exporters at affordable rates. He added that the rates were likely to be in the sub-four percent category.

Goyal further said that his ministry is waiting for Finance Minister Nirmala Sitharaman to take a call on some of the issues on export credit. He also urged states to send representatives to the Board of Trade meetings. He said “the level of participation of states and ministries will determine the cooperation that we will give them.” He also said “if the ministers of states are busy and don't find time to come for these meetings without due cause known to us in advance, 'then if states have any problems, I may find myself busy to respond to those states.”

The minister has indicated that export credit disbursement declined by 23 percent to Rs 9.57 lakh crore in 2018-19 as compared to Rs 12.39 lakh crore in 2017-18. He said that although total exports crossed half-a-trillion-dollar mark at $537 billion in 2018-19, India will have to achieve $1 trillion of exports in the next five years. He added that the ministry will soon come out with a credit scheme for exporters with enhanced insurance cover up to 90 percent instead of the present 60 percent.

The CNX Nifty is currently trading at 10980.35, down by 2.45 points or 0.02% after trading in a range of 10945.75 and 11023.85. There were 23 stocks advancing against 26 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Titan Company up by 2.64%, Mahindra & Mahindra up by 1.27%, Kotak Mahindra Bank up by 1.22%, ICICI Bank up by 1.13% and Bajaj Auto was up by 1.09%. On the flip side, Yes Bank down by 3.97%, Indiabulls Housing Finance down by 1.92%, Dr. Reddys Lab down by 1.63%, Bharti Airtel down by 1.48% and Tata Steel was down by 1.40% were the top losers.

All Asian markets were trading in green; Nikkei 225 surged 228.68 points or 1.05% to 21,988.29, Straits Times advanced 17.05 points or 0.53% to 3,212.01, Jakarta Composite soared 1.46 points or 0.02% to 6,343.63 and Hang Seng was up by167.87 points or 0.62% to 27,255.50.