Sensex, Nifty trade flat with positive bias in early noon deals

Indian equity benchmarks were lingering near their neutral lines, with both Sensex and Nifty holding marginal gains, amid negative cues from other Asian markets. Traders were positive, amid a private report stating retail inflation in April will soften with base effect and the inflation print may read a full percentage point lower, after a favourable base effect sharply pulled down Consumer Price Index (CPI) inflation to 5.66 percent in March. However, upside remained capped, as another private report stated that India's economy will slow considerably this fiscal year as the global economic slowdown impedes domestic growth prospects, which showed inflation will remain elevated despite recent interest rate hikes.

On the global front, Asian markets were trading mostly in red, after Japan posted a merchandise trade deficit of 754.506 billion yen in March.  That beat forecasts for a deficit of 1,294.8 billion yen following the 898.1 billion yen shortfall in February. Exports were up 4.3 percent on year at 8.458 trillion yen - also exceeding expectations for an increase of 2.6 percent following the 6.5 percent gain in the previous month.

The BSE Sensex is currently trading at 59630.57, up by 62.77 points or 0.11% after trading in a range of 59504.54 and 59836.79. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose by 0.13%, while Small cap index was up by 0.28%.

The top gaining sectoral indices on the BSE were Telecom up by 0.74%, Consumer Durables up by 0.73%, Utilities up by 0.71%, Power up by 0.57% and Industrials up by 0.53%, while Healthcare down by 0.80%, Realty down by 0.48%, FMCG down by 0.23%, Oil & Gas down by 0.17% and Energy down by 0.17% were the top losing indices on BSE.

The top gainers on the Sensex were NTPC up by 1.44%, Tata Motors up by 1.23%, Titan Company up by 0.89%, Asian Paints up by 0.82% and Tech Mahindra up by 0.68%. On the flip side, Sun Pharma down by 1.03%, Nestle down by 0.90%, Bajaj Finance down by 0.67%, Axis Bank down by 0.59% and Hindustan Unilever down by 0.55% were the top losers.

Meanwhile, credit rating agency Crisil in its latest report has said that continuing healthy demand from construction, real estate and automobile sectors will help the paint sector register a 10-12 per cent revenue growth this fiscal (FY24) against an 18 per cent estimated rise in the just-concluded fiscal (FY23). Paint companies are likely to close FY23 with a robust 18 per cent revenue growth, primarily led by higher realisations on the back of a 6 per cent price hike during the year, along with the full impact of a 20 per cent price hike effected in the third quarter of FY22.

According to the report, volume expansion and the resultant cash generation will help paint companies maintain healthy balance sheets, which will also buffer credit profiles despite the rising capex. It noted that the top five companies have announced Rs 12,000 crore capex in fiscal 2023 and 2024 on the back of Rs 7,000 crore they incurred in the previous four fiscals. It said new players are expected to add nearly one-third of the total existing capacity of 4.2 billion litres by fiscal 2025-end.

The report further said along with healthy volume growth, moderating crude-linked input prices will ensure operating margins to remain stable at 15-16 per cent in fiscal 2024, almost similar to the last fiscal. It also said their near debt-free balance sheets will support credit risk profiles despite all major paint companies being on an aggressive capex spree. The domestic paints sector also comprises the decorative segment, which commands 80 per cent of the market.

The CNX Nifty is currently trading at 17625.00, up by 6.25 points or 0.04% after trading in a range of 17590.10 and 17684.45. There were 26 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were NTPC up by 1.41%, Adani Ports and Special Economic Zone up by 1.20%, Tata Motors up by 1.17%, Asian Paints up by 0.99% and Tech Mahindra up by 0.87%. On the flip side, Divi's Laboratories down by 3.64%, Eicher Motors down by 1.60%, Dr Reddy's Laboratories down by 1.32%, Nestle down by 0.92% and JSW Steel down by 0.89% were the top losers.

Asian markets were trading mostly in red; Taiwan Weighted lost 62.95 points or 0.4% to 15,707.52, KOSPI dropped 11.97 points or 0.47% to 2,563.11, Straits Times fell 10.42 points or 0.31% to 3,313.63 and Shanghai Composite weakened 6.89 points or 0.2% to 3,363.24, while Hang Seng advanced 34.25 points or 0.17% to 20,402.01 and Nikkei 225 surged 50.81 points or 0.18% to 28,657.57.