Benchmarks trade slightly lower in early deals on profit booking

Snapping their three days northward journey, Indian equity benchmarks are trading slightly in red in Wednesday’s morning deals as investors opted to book their profit on penultimate day of the expiry of May F&O series. Sentiments also remained somber after the Indian rupee fell by 22 paise to trade at fresh nine-month low of 56.18 against the US dollar in early trade on the Interbank Foreign Exchange due to month-end demand for the US currency from importers and banks.

However, the downside remain capped as global cues remained supportive with the US markets showing a jubilant performance overnight, coming after a long weekend. Though, there was some pull back in late trade but major indices managed to remain firmly positive on slew of upbeat economic data. While, most of the Asian equity indices were trading in green at this point of time with Japanese Nikkei share average surging by over half a percent in a morning session on Wednesday, as investors remained unsettled after last week’s tumultuous trade pulled the index down 10 percent from a five and a half year high.

Back home, on the sectoral front, healthcare witnessed the maximum gain in trade followed by software and auto while, banking, realty and capital goods remained the only losers on the BSE sectoral space. However, the broader indices were outperforming benchmarks while, the market breadth on the BSE was evenly divided; there were 627 shares on the gaining side against 630 shares on the losing side while 65 shares remain unchanged.

The BSE Sensex opened at 20,202.51; about 41 points higher compared to its previous closing of 20,160.82, and has touched a high and a low of 20,216.49 and 20,080.64 respectively. The index is currently trading at 20,140.45, down by 20.37 points or 0.10%. There were 11 stocks advancing against 19 declines on the index.

The overall market breadth was evenly divided with 47.43% stocks advancing against 47.66% declines. The broader indices were trading in green; the BSE Mid cap and Small cap indices up by 0.19% and 0.23% respectively. 

The top gaining sectoral indices on the BSE were, Health Care up by 0.88%, IT up by 0.69%, Auto up by 0.42%, Consumer Durables up by 0.37% and Teck up by 0.37% while, Bankex down by 0.58%, Realty down by 0.56%, Capital Goods down by 0.55%, Power down by 0.35% and Oil & Gas down by 0.04% were the top losers on the sectoral index.

The top gainers on the Sensex were Sun Pharma up by 4.29%, Hero MotoCorp up by 1.99%, Tata Motors up by 1.77%, Coal India up by 0.99% and Infosys up by 0.72%.

On the flip side, HDFC was down by 1.14%, HDFC Bank was down by 0.90%, Dr Reddys Lab was down by 0.87%, L&T was down by 0.82% and  Maruti Suzuki was down by 0.79% were the top losers on the Sensex.

Meanwhile, with many states expressing difficulty in acquiring the vast tracts of land needed to set up dedicated manufacturing zones, the government’s ambitious manufacturing thrust has run into trouble even before it could take off. Some states in north and north-east have expressed their inability to set up National Manufacturing Investment Zones (NMIZs) as it would involve either acquiring huge agricultural land or hilly terrain interspersed with plains and valleys.

Five states such as Punjab, Himachal Pradesh, Assam, Manipur and Meghalaya have written to the Department of Industrial Policy and Promotion (DIPP) requesting it to consider revising the minimum land requirement (from existing 5,000 hectare) for developing NMIZs. On the other hand, the government is no mood to reduce the minimum land requirement for NMIZs as it did for special economic zones as the NMP is relatively new and any reversal in policy at this point of time will hit the investor sentiments.

The government has introduced its ambitious national manufacturing policy (NMP) in 2011 and the proposals contained in the policy apply to manufacturing industry throughout the country. The objective of NMP is to increase the share of manufacturing to GDP from the existing 15% to 25% by 2025 and create 100 million jobs. This would be done by setting up Greenfield integrated townships or NMIZs with a minimum area of 5,000 hectare. 

The CNX Nifty opened at 6,120.45; about 9 points higher as compared to its previous closing of 6,111.25, and has touched a high and a low of 6,125.05 and 6,083.10 respectively.

The index is currently trading at 6,099.80, down by 11.45 points or 0.19%. There were 14 stocks advancing against 34 declines, while 2 stocks remains unchanged on the index.

The top gainers of the Nifty were Sun Pharmaceuticals up by 4.04%, Hero MotoCorp up by 1.79%, Tata Motors up by 1.62%, HCL Technologies up by 1.45% and BPCL up by 1.29%.

On the flip side, Ranbaxy down by 2.22%, JP Associate down by 1.60%, HDFC down by 1.19%, Dr. Reddy's Laboratories down by 1.03% and Grasim Industries down by 0.99% were the major losers on the index.

Most of the Asian equity indices were trading in green; Shanghai Composite rose 8.20 points or 0.35% to 2,329.52, KLSE Composite strengthened 8.36 points or 0.47% to 1,784.52, Nikkei 225 surged 103.46 points or 0.72% to 14,415.44, KOSPI Composite jumped 14.98 points or 0.75% to 2,001.20 and Taiwan Weighted was up by 71.05 points or 0.86% to 8,334.10.

On the flip side, Hang Seng declined 156.90 points or 0.68% to 22,767.35, Jakarta Composite slipped 8.69 points or 0.17% to 5,167.54 and Straits Times was down by 1.43 points or 0.04% to 3,404.65.