Markets continue to trade lower in early noon session

Indian equity benchmarks continued to trade lower in early noon session, on the back of profit booking by investors amid a lackluster trade in other Asian markets. Some cautiousness prevailed in the markets with International Monetary Fund’s report that India is now in the middle of a significant economic slowdown, urging the government to take immediate policy actions to tackle the current prolonged downturn. Meanwhile, to protect consumers interest, the Reserve Bank of India stated that on peer-to-peer lending (P2P) platform the permissible exposure of a lender to all borrowers should not exceed Rs 50 lakh at any given point of time. The lender investing more than Rs 10 lakh across P2P platforms will have to produce a certificate to P2P platforms from a practicing Chartered Accountant certifying minimum net-worth of Rs 50 lakh.

On global front, most of the Asian markets were trading in red, despite stocks closed higher on Wall Street, extending the major indexes’ milestone-shattering run. Back on street, in scrip specific development, shares of Indian Railway Catering and Tourism Corporation (IRCTC) gained after the Ministry of Railways revised tariff of standard meals on static units in railway stations.

The BSE Sensex is currently trading at 41604.19, down by 38.47 points or 0.09% after trading in a range of 41572.66 and 41702.98. There were 21 stocks advancing against 9 stocks declining, while 1 stock remain unchanged on the index.

The broader indices were trading mixed; the BSE Mid cap index lost 0.02%, while Small cap index was up by 0.06%.

The top gaining sectoral indices on the BSE were Metal up by 0.70%, Consumer Durables up by 0.45%, Power up by 0.27%, Realty up by 0.24% and Auto up by 0.21%, while IT down by 0.67%, TECK down by 0.55%, Energy down by 0.48%, Oil & Gas down by 0.06% and Capital Goods down by 0.05% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 2.21%, ONGC up by 1.44%, Hero MotoCorp up by 0.96%, Titan Company up by 0.72% and Mahindra & Mahindra was up by 0.60%. On the flip side, HCL Technologies down by 1.91%, Tech Mahindra down by 0.90%, Reliance Industries down by 0.89%, Infosys down by 0.71% and HDFC Bank was down by 0.56% were the top losers.

Meanwhile, PHD Chamber of Commerce and Industry (PHDCCI) President D K Aggarwal has said that the new criteria for definition of micro, small and medium enterprises (MSMEs) on the basis of turnover will help in promoting the ease of doing business as the process of identification and dealings with such entities will become simpler and faster. Also, he said the proposed criteria is in line with the criteria which is internationally applied and understood.  In February 2018, the Union Cabinet had approved amendments to the law to change the criteria for classifying MSMEs from 'investment in plant and machinery' to 'annual turnover'.

Aggarwal has stated that the proposed definition defines a micro enterprise as a unit where the annual turnover does not exceed five crore rupees; a small enterprise as a unit where the annual turnover is more than five crore rupees but does not exceed Rs 75 crore and a medium enterprise as a unit where the annual turnover is more than seventy five crore rupees but does not exceed Rs 250 crore. He pointed out that the MSME sector is critical in meeting the national objectives of generating employment, reducing poverty and slowing rural-urban migration. Therefore, he said the proposed definition will help in directing the benefits of economic growth to the intended beneficiaries.

Aggarwal further said that MSMEs are the pillars of economic growth as they contribute around 32 per cent in gross value added, employ around 111 million people (36.2 million in manufacturing, 38.71 million in trade and 36.28 million in other services) with a contribution of more than 48 per cent in total exports of India.  He noted that at present, the definition of MSMEs is based on whether these companies produce goods or render services. He added that this definition, based on investment in plant and machinery for manufacturing MSMEs and investment in equipment for service sector MSMEs was introduced in the year 2006 through the Micro, Small and Medium Enterprises Development Act.

The CNX Nifty is currently trading at 12252.55, down by 10.20 points or 0.08% after trading in a range of 12244.05 and 12283.70. There were 32 stocks advancing against 17 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Yes Bank up by 2.92%, Indusind Bank up by 2.07%, Zee Entertainment up by 1.54%, ONGC up by 1.44% and JSW Steel was up by 1.16%. On the flip side, HCL Technologies down by 1.76%, Reliance Industries down by 0.93%, Infosys down by 0.81%, Wipro down by 0.81% and Eicher Motors was down by 0.75% were the top losers.

Asian markets are trading mostly in red, Hang Seng decreased 42.20 points or 0.15% to 27,864.21, KOSPI fell 11.23 points or 0.51% to 2,192.48, Taiwan Weighted dropped 45.85 points or 0.38% to 11,976.38 and Nikkei 225 was down by 2.17 points or 0.01% to 23,818.94.

On the flip side, Shanghai Composite gained 11.55 points or 0.39% to 2,974.30 and Straits Times was up by 7.67 points or 0.24% to 3,221.67.