Benchmarks erase gains to trade flat in morning deals

Erasing all their opening gains, Indian equity benchmarks have traded flat with a negative bias in morning session, as the continued surge in coronavirus cases weighed on the sentiment. Traders also remained cautious with private report that the country’s economy is likely to show a double-digit contraction in the April-June quarter due to the restriction on economic activities on account of the COVID-19 pandemic. However, losses remain capped as traders took some support with Niti Aayog CEO Amitabh Kant’s statement that India, which has been hit hard by the Coronavirus disease (COVID-19) pandemic, will bounce back soon with green shoots in the economy already being visible. He said with the gradually unlocking, economic activities are reviving. On the sectoral front, Pharma stocks remained in focus with report by India Ratings and Research (Ind-Ra) stating that Indian pharmaceutical companies have built a strong abbreviated new drug application (ANDA) pipeline since FY12 through scaling-up of investments in R&D but this will increase the inspection intensity.

On the global front, Asian markets were trading mostly in green, despite renewed coronavirus concerns as World Health Organization officials warned that the death toll from the pandemic may start to climb again. The recent spike in coronavirus cases in the U.S. and other parts of the world have dampened hopes of a quick economic recovery. Back home, the BSE Sensex is currently trading at 36666.07, down by 8.45 points or 0.02% after trading in a range of 36607.83 and 36828.43. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.26%, while Small cap index was up by 0.35%.

The top gaining sectoral indices on the BSE were Metal up by 1.25%, Healthcare up by 0.80%, Bankex up by 0.72%, FMCG up by 0.52% and Basic Materials up by 0.49%, while IT down by 1.06%, TECK down by 0.87%, Power down by 0.54%, Utilities down by 0.54% and Auto down by 0.50% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 4.83%, SBI up by 2.81%, Tata Steel up by 2.17%, Nestle up by 1.48% and ITC up by 1.29%. On the flip side, Infosys down by 1.77%, HCL Technologies down by 1.76%, Ultratech Cement down by 1.55%, Bajaj Finance down by 1.33% and Maruti Suzuki down by 1.28% were the top losers.

Meanwhile, the finance ministry said banks have sanctioned loans of about Rs 1,14,502 crore under the Rs 3-lakh crore Emergency Credit Line Guarantee Scheme (ECLGS) for MSME sector reeling under the economic slowdown caused by the COVID-19 pandemic. Disbursements against this stood at Rs 56,091.18 lakh crore till July 4 under the 100 per cent ECLGS for micro, small and medium enterprises (MSMEs). The scheme is the biggest fiscal component of the Rs 20-lakh crore 'Aatmanirbhar Bharat Abhiyan' package announced by government in May.

The latest numbers on ECLGS comprise disbursements by all 12 public sector banks (PSBs), 20 private sector banks and 10 non-banking financial companies (NBFCs). Under the ECLGS, the loan amounts sanctioned by PSBs increased to Rs 65,863.63 crore, of which Rs 35,575.48 crore has been disbursed as of July 4.  At the same time, private sector banks have sanctioned Rs 48,638.96 crore and disbursed Rs 20,515.70 crore.

SBI has sanctioned Rs 20,628 crore of loans and disbursed Rs 13,405 crore. It is followed by Punjab National Bank, which has sanctioned Rs 8,689 crore. However, its disbursements stood at Rs 2,595 crore as of July 4. The business units of Maharashtra have got the highest cumulative sanction of Rs 6,856 crore from banks, while disbursement was to the tune of Rs 3,605 crore as of July 4. It is followed by Tamil Nadu, with sanction of Rs 6,616 crore loans and disbursements of Rs 3,871 crore.

The CNX Nifty is currently trading at 10795.65, down by 4.00 points or 0.04% after trading in a range of 10784.60 and 10847.85. There were 22 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were Indusind Bank up by 4.69%, SBI up by 3.00%, JSW Steel up by 2.46%, Dr. Reddys Lab up by 2.21% and Tata Steel up by 1.98%. On the flip side, Infosys down by 1.72%, Ultratech Cement down by 1.70%, HCL Tech down by 1.68%, Zee Entertainment down by 1.55% and Adani Ports &SEZ down by 1.43% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 87.85 points or 0.34% to 26,063.51, Jakarta Composite soared 64.84 points or 1.3% to 5,051.92, Taiwan Weighted strengthened 60.57 points or 0.5% to 12,153.54, Shanghai Composite gained 24.89 points or 0.74% to 3,370.23 and Straits Times advanced 0.08 points or 0% to 2,661.50.

On the flip side, KOSPI fell 8.30 points or 0.38% to 2,155.87 and Nikkei 225 slipped 142.20 points or 0.63% to 22,472.49.