Indices trim gains in late morning deals

05 Aug 2020 Evaluate

Indian equity benchmarks trimmed most of their gains in late morning deals, despite positive cues from other Asian markets. Heavy selling at Energy and FMCG counters impacted trade in late morning deals. Domestic sentiments got hit, as the Indian service sector remained severely restricted by lockdown measures implemented to curb the coronavirus disease 2019 (COVID-19) pandemic in July. Further substantial reductions in both activity and inflows of new work were recorded as ongoing lockdown restrictions stifled demand and forced companies to cease operations.

On the global front, Asian markets were trading mostly in green, as the services sector in China continued to expand in July, albeit at a slower pace, the latest survey from Caixin revealed on Wednesday with a PMI score of 54.1. That's down from the 10-year high of 58.4 in June, although it remains above the boom-or-bust line of 50 that separates expansion from contraction.

The BSE Sensex is currently trading at 37719.47, up by 31.56 points or 0.08% after trading in a range of 37703.14 and 38139.96. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.42%, while Small cap index was up by 0.70%.

The top gaining sectoral indices on the BSE were Metal up by 2.81%, Basic Materials up by 1.29%, Auto up by 1.25%, Consumer Discretionary up by 1.09% and Bankex up by 1.00%, while Energy down by 0.83%, FMCG down by 0.34%, Power down by 0.26%, IT down by 0.25% and TECK down by 0.21% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 4.16%, Axis Bank up by 2.60%, Maruti Suzuki up by 2.60%, Kotak Mahindra Bank up by 1.72% and Titan Company up by 1.64%. On the flip side, HDFC Bank down by 1.26%, Power Grid down by 1.12%, Reliance Industries down by 1.05%, Infosys down by 0.66% and Tech Mahindra down by 0.64% were the top losers.

Meanwhile, the Department of Economic Affairs in its monthly macroeconomic report has said that after Prime Minister Narendra Modi announced a nationwide lockdown to arrest the spread of coronavirus, India’s economy trembled in the month of April. While the businesses and industries came to a standstill, the economy struggled for revenue sources. However, the worst may now be over for India and the road ahead will take the economy back on the track.

It mentioned with India unlocking, the worst seems to be over as high-frequency indicators show an improvement from the unprecedented trough the economy had hit in April 2020. It added Indicators such as Index of Industrial Production (IIP), Purchasing Managers Index (PMI), power generation, production of steel and cement, railway freight, traffic at major ports, air cargo and passenger traffic, e-way bill generation capturing the inter-state movement of goods, consumption of petroleum products, and motor vehicle registration, have shown improvements.

The report underlined that the agricultural outlook improving and the recent landmark reforms announced in the sector are well-timed. However, it said risks on account of rising COVID-19 cases and intermittent state lockdowns remain,. The future economic recovery of India is believed to be crucially linked to how the COVID-19 infection curve evolves across the states.

The CNX Nifty is currently trading at 11118.75, up by 23.50 points or 0.21% after trading in a range of 11107.05 and 11225.65. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 6.19%, Tata Steel up by 4.22%, Maruti Suzuki up by 2.74%, Axis Bank up by 2.71% and Adani Ports & SEZ up by 2.35%. On the flip side, HDFC Bank down by 1.13%, Power Grid down by 1.09%, Reliance Industries down by 0.90%, UPL down by 0.84% and Wipro down by 0.75% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 141.73 points or 0.57% to 25,088.36, Taiwan Weighted strengthened 88.45 points or 0.7% to 12,798.37, Jakarta Composite soared 8.56 points or 0.17% to 5,083.56, Straits Times advanced 17.23 points or 0.68% to 2,532.93, KOSPI rose 23.59 points or 1.03% to 2,303.56 and Shanghai Composite gained 9.66 points or 0.29% to 3,381.35. On the flip side, Nikkei 225 slipped 57.43 points or 0.25% to 22,516.23.

Indices trim gains in late morning deals

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