Sensex, Nifty turn negative in late morning deals

Indian equity benchmarks turned negative in late morning deals, with both Sensex and Nifty trading with notable losses. Negative cues from other Asian markets impacted domestic sentiments. Traders overlooked reports that continuing efforts to improve the ease of doing business in the securities market, Sebi approved a slew of proposals, including relaxing minimum public offer requirements and amending norms for portfolio managers. Besides, the watchdog cleared repealing of Sebi (Underwriters) Regulations, 1993 and amendments to the Sebi (Merchant Bankers) Regulations, 1992 and the SEBI (Stock Brokers) Regulations, 1992.

On the global front, Asian markets were trading mostly in red, even after South Korea's money supply growth rose in December. The figures from Bank of Korea showed that M2, a broad measure of money supply, increased 9.8 percent year-on-year in December, following a 9.7 percent increase in November. On a monthly basis, M2 money supply rose 0.4 percent in December, slower than 0.9 percent increase in the previous month. The annual growth in liquidity indicator L fell to 8.3 percent in December from 8.4 percent in the preceding month.

The BSE Sensex is currently trading at 51460.53, down by 243.30 points or 0.47% after trading in a range of 51456.86 and 51903.96. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.60%, while Small cap index was up by 0.76%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 4.10%, PSU up by 3.20%, Utilities up by 3.00%, Power up by 1.24% and Energy up by 0.91%, while Auto down by 0.87%, Bankex down by 0.84%, Telecom down by 0.80%, Healthcare down by 0.49% and Capital Goods down by 0.44% were the top losing indices on BSE.

The top gainers on the Sensex were ONGC up by 6.56%, Asian Paints up by 2.38%, NTPC up by 2.26%, SBI up by 1.93% and Power Grid up by 1.91%. On the flip side, Kotak Mahindra Bank down by 1.97%, ICICI Bank down by 1.96%, Bajaj Finance down by 1.67%, Mahindra & Mahindra down by 1.49% and HDFC down by 1.46% were the top losers.

Meanwhile, in order to boost telecom industry, the government has approved a Rs 12,195 crore production-linked incentive (PLI) scheme for telecom gear manufacturing in India. This move will position the nation as a global powerhouse for production of such equipment ahead of 5G roll-outs. The PLI scheme for telecom gear manufacturing, will be operational from April 1, 2021. It will lead to incremental production of around Rs 2.4 lakh crore with exports of around Rs 2 lakh crore over five years. The scheme is expected to bring investment of over Rs 3,000 crore and generate huge direct and indirect employment and taxes both.

The scheme is expected to offset huge imports of telecom equipment worth more than Rs 50,000 crore and reinforce it with Made in India products both for domestic markets and exports. The new scheme has an outlay of Rs 12,195 crore over five years, and its eligibility will be subject to achievement of a minimum threshold of cumulative incremental investment and incremental sales of manufactured goods. The incentive structure ranges between 4 and 7 per cent for different categories and years.

Besides, Financial Year 2019-20 will be treated as the base year for computation of cumulative incremental sales of manufactured goods net of taxes. Minimum investment threshold for MSMEs has been kept at Rs 10 crore and for others at Rs 100 crore. Once qualified, the investor will be incentivized up to 20 times of minimum investment threshold enabling them to utilize their unused capacity.

Communications Minister Ravi Shankar Prasad has said that the government is positioning India as a global powerhouse for manufacturing, and has created a conducive environment for ease of doing business. he said ‘Cabinet has approved PLI for telecom sector...to ensure further progress of Make-in-India in telecom equipment space...5G equipment will also come...so it was important to give incentives. We held widespread consultation with stakeholders’, and added that the scheme also aims to promote MSMEs in ‘Aatmanirbhar Bharat’.

The CNX Nifty is currently trading at 15144.65, down by 64.25 points or 0.42% after trading in a range of 15144.45 and 15250.75. There were 22 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were GAIL India up by 7.33%, ONGC up by 6.41%, Indian Oil Corporation up by 4.11%, Asian Paints up by 2.50% and UPL up by 2.42%. On the flip side, Kotak Mahindra Bank down by 2.14%, Shree Cement down by 2.05%, ICICI Bank down by 1.99%, Bajaj Finance down by 1.77% and HDFC down by 1.73% were the top losers.

Asian markets were trading mostly in red; Straits Times trembled 12.22 points or 0.42% to 2,908.21, KOSPI fell 31.29 points or 1% to 3,102.44, Nikkei 225 slipped 52.64 points or 0.17% to 30,239.55 and Hang Seng decreased 361.11 points or 1.16% to 30,723.83. On the flip side, Taiwan Weighted strengthened 46.95 points or 0.29% to 16,409.24, Jakarta Composite soared 21.85 points or 0.35% to 6,249.58 and Shanghai Composite gained 14.33 points or 0.39% to 3,669.42.