Benchmarks trade tad lower in early deals

Indian equity benchmarks made slightly positive start on Wednesday amid mixed Asian cues. But, soon markets lost momentum to slip into red territory and are trading tad lower in early deals amid caution ahead of the expiry of July series derivative contracts on Thursday. Also, selling in Energy, Oil & Gas and Auto stocks were weighted down on sentiments. opening gains was supported with Industry body CII’s statement that high frequency indicators are showing a material improvement as compared to multi-year low seen in April, and pointing towards a V-shaped recovery after the economy suffered on account of lockdown amid the coronavirus pandemic. However, traders turned cautious with rising coronavirus cases. India has recorded over 49,000 cases in the past 24 hours, taking its total number of Covid-19-positive cases to 1,532,135. The country's coronavirus caseload is the third-highest in the world, next only to the US (4,498,000) and Brazil (2,484,649). Adding pessimism global forecasting firm Oxford Economics said that it expects India's GDP growth to lose momentum from late third quarter (October-December) of the current fiscal as the push from the initial reopening fades. Market participants are keeping eye on Prime Minister Narendra Modi meeting with stakeholders from Banks and NBFCs as well as secretaries to discuss and deliberate on vision and roadmap for the future today.

On the global front, Asian markets are trading mixed following the negative cues overnight from Wall Street amid uncertainty about a US coronavirus relief bill. Investors also turned cautious ahead of the US Federal Reserve's monetary policy decision due later in the day. While the Fed is widely expected to leave interest rates unchanged, investors may look to the accompanying statement for clues about future plans to provide additional economic stimulus.

Back home, fertiliser stocks were in focus with ICRA’s report that fertiliser companies are expected to register healthy profitability in the current financial year due to the robust fertiliser off-take by the farmers in the first quarter coupled with strong growth visible across segments. In scrip specific developments, Bharti Airtel and InterGlobe Aviation were in limelight ahead of their earnings. IDFC First Bank rallied as it logged a net profit of Rs. 94 crore in the first quarter ended June as compared to net loss of Rs. 617 crore for Q1 FY20.

The BSE Sensex is currently trading at 38374.48, down by 118.47 points or 0.31% after trading in a range of 38336.03 and 38617.03. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.44%, while Small cap index was up by 0.49%.

The top gaining sectoral indices on the BSE were Basic Materials up by 1.01%, Capital Goods up by 0.83%, Metal up by 0.79%, Utilities up by 0.76%, Power up by 0.69%, while Energy down by 1.17%, Oil & Gas down by 0.64%, Auto down by 0.45%, IT down by 0.41%, TECK down by 0.39% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 4.07%, Ultratech Cement up by 2.28%, Tata Steel up by 2.13%, Larsen & Toubro up by 1.56% and Sun Pharma up by 1.37%. On the flip side, Nestle down by 1.35%, Reliance Industries down by 1.31%, HCL Technologies down by 1.28%, Maruti Suzuki down by 1.07% and Mahindra & Mahindra down by 1.06% were the top losers.

Meanwhile, in order to address liquidity crunch faced by the COVID-19-hit economy, the Road Transport, Highways and MSME minister Nitin Gadkari has said the government is making efforts to attract foreign direct investment (FDI) in infrastructure sector. The minister stated ‘we are trying to get FDI (foreign direct investment) in Infrastructure as it is 100 per cent allowed. We are trying to bring Insurance Fund, Pension Fund etc, while talks are on with the World Bank, ADB... We are moving fast in that direction.’

Urging private players to join hands with the government, he said the economy - hit by coronavirus - is passing through a crucial phase and requires liquidity. At the same, COVID-19 crisis should be turned into an opportunity as the world is now recognising India as a good place for investment, he said, adding the government has taken a policy decision to offer projects only after 90 percent land acquisition and regulatory clearances like forest and environment.

Further, he said ‘in infrastructure, we are trying as to how we can get maximum investment. Today, there are huge opportunities in highways, power, transport, water, communciation and other sectors.’ He added industrial development and job creation was not possible without propelling infrastructure. He also stressed the need to bring down logistics costs and said that Rs 1 lakh crore Delhi-Mumbai Expressway will result in reducing the travel time between the two metropolises to barely 28 hours resulting in lesser logistics cost by way of enhanced cargo movement in lesser time.

The CNX Nifty is currently trading at 11295.50, down by 5.05 points or 0.04% after trading in a range of 11262.65 and 11341.40. There were 33 stocks advancing against 16 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Indusind Bank up by 3.90%, Grasim Industries up by 2.83%, Tata Steel up by 2.37%, Bharti Infratel up by 2.31% and Ultratech Cement up by 2.27%. On the flip side, Adani Ports & SEZ down by 1.46%, Nestle down by 1.36%, BPCL down by 1.26%, Reliance Industries down by 1.13% and HCL Technologies down by 1.12% were the top losers.

Asian markets are trading mixed; Hang Seng rose 29.18 points or 0.12% to 24,801.94, Taiwan Weighted gained 24.86 points or 0.20% to 12,611.59, KOSPI added 7.19 points or 0.32% to 2,264.18 and Shanghai Composite was up by 33.80 points or 1.05% to 3,261.76. On the other hand, Nikkei 225 declined 209.93 points or 0.93% to 22,447.45, Straits Times fell 3.08 points or 0.12% to 2,579.89 and Jakarta Composite was down by 7.99 points or 0.16% to 5,105.00.