Benchmarks trade flat in early deals after negative start

Indian equity benchmarks made negative start on Wednesday tracking weakness in global peers. But, soon markets managed to recovered most of their losses and are trading flat in early deals. Buying in FMCG, Oil & Gas and PSU counters aiding the sentiments, whereas selling in Power, Utilities and Energy stocks kept upside in check. Early cautiousness came in as global forecasting firm Oxford Economics said retail inflation spike in May might cause the RBI to revisit its focus on growth risks and added that a rate hike is still unlikely this year. Also, India reported 62,226 new cases in the last 24 hours. With this, the country's total coronavirus caseload has reached 29,632,261. However, some respite came in as the government data showed that India’s merchandise exports grew 69.35 per cent year-on-year in May to $32.27 billion on account of low-base effect as well as rising demand from external markets. The growth has been driven by demand for items such as petroleum goods, engineering goods and gems and jewellery.

On the global front, most of the Asian markets were trading lower following the negative cues overnight from Wall Street. Traders are refraining from making significant moves as they await the U.S. Federal Reserve's monetary policy and its latest economic projections later in the day. Traders are also in a cautious mood as coronavirus cases remain high in most markets in the region. Back home, insurance stocks were in focus as the DPIIT notified the government's decision to increase the FDI limit in the insurance sector under the automatic route to 74 per cent from 49 per cent earlier. In scrip specific development, Adani Ports and Special Economic Zone fell as Fitch Ratings affirmed its long-term foreign-currency issuer default rating and placed a negative outlook on the company.

The BSE Sensex is currently trading at 52774.75, up by 1.70 points after trading in a range of 52607.61 and 52816.31. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.12%, while Small cap index was up by 0.24%.

The top gaining sectoral indices on the BSE were FMCG up by 0.68%, Oil & Gas up by 0.51%, PSU up by 0.44%, Realty up by 0.33%, Bankex up by 0.25%, while Power down by 1.26%, Utilities down by 0.71%, Energy down by 0.40%, Metal down by 0.36%, Consumer Durables down by 0.31% were the top losing indices on BSE.

The top gainers on the Sensex were ONGC up by 1.20%, Hindustan Unilever up by 0.98%, Mahindra & Mahindra up by 0.88%, ITC up by 0.77% and Bajaj Finserv up by 0.68%. On the flip side, Power Grid down by 1.13%, HCL Technologies down by 0.62%, Bajaj Finance down by 0.56%, Reliance Industries down by 0.46% and HDFC down by 0.37% were the top losers.

Meanwhile, the government has simplified the registration process for micro, small and medium enterprises (MSMEs) and they will now only need to furnish PAN and Aadhaar to register.

Announcing the measure, MSME minister Nitin Gadkari said that after getting registered, the MSME unit will be getting priority and finance. He said there is a need to impart training to small units in fields of entrepreneurship and other related aspects. He also expressed hope that banks and non-banking finance companies will also provide full support to small businesses.

Emphasizing the importance of MSMEs, Gadkari said that the MSMEs contribute significantly in the economic and social development of the country by fostering entrepreneurship and generating large employment opportunities. He said that with an objective of making India a global economic powerhouse, vision of MSME aims towards building a supporting ecosystem for MSMEs to enhance their contribution towards five trillion dollar economy. He said that in order to boost the economic activities of MSMEs, the government has announced a special incentive package ‘Aatmanirbhar Bharat Abhiyan’ of Rs 20 lakh crore.

The CNX Nifty is currently trading at 15851.50, down by 17.75 points or 0.11% after trading in a range of 15815.00 and 15880.85. There were 20 stocks advancing against 30 stocks declining on the index.

The top gainers on Nifty were Tata Consumer Products up by 1.42%, UPL up by 1.21%, Hindustan Unilever up by 1.03%, ONGC up by 1.00% and ITC up by 0.75%. On the flip side, Hindalco down by 2.02%, Adani Ports & SEZ down by 1.98%, Power Grid down by 1.31%, JSW Steel down by 1.25% and Reliance Industries down by 0.74% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 declined 121.96 points or 0.41% to 29,319.34, Straits Times fell 23.65 points or 0.74% to 3,151.22, Hang Seng slipped 84.19 points or 0.29% to 28,554.34, Taiwan Weighted lost 11.90 points or 0.07% to 17,359.39 and Shanghai Composite was down by 27.45 points or 0.77% to 3,529.11. On the other hand, KOSPI added 18.87 points or 0.58% to 3,277.50 and Jakarta Composite gained 4.82 points or 0.08% to 6,093.86.