Markets wipe out opening gains in early deals

Indian equity benchmarks opened with record highs on Tuesday, tracking overnight gains on Wall Street. Soon, markets wiped out all their opening gains and entered into red terrain in early deals due to selling in Bankex and Auto stocks. Initially, some support came in as the gross GST collection increased 8 per cent to Rs 1.74 lakh crore in June. Traders took note of the India Meteorological Department’s (IMD) statement that after an uneven run in June, the southwest monsoon is expected to become vigorous in July with all-India average rain across the country predicted at 106 per cent of the long-period average (LPA), which is above normal. But, surge in crude oil prices and foreign fund outflows dampened sentiments in the markets. Oil prices were higher on expectations for rising fuel demand from the summer travel season and possible U.S. interest rate cuts that could boost economic growth. The Foreign institutional investors (FIIs) sold equities worth Rs 426 crore on July 1. 

On the global front, most of the Asian markets are trading higher as traders seemed reluctant to make significant moves ahead of key US employment data later in the week, which is expected to show a slowdown in the pace of job growth in June, could impact the outlook for interest rates. Back home, oil and gas sector stocks were in focus with report that the Indian government has raised the windfall tax on petroleum crude to Rs 6,000 ($72) per metric ton from Rs 3,250, effective from July 2. Meanwhile, the main board IPO - Allied Blenders and Distillers is likely to debut on the bourses. Moreover, Bansal Wire Rs 745 crore IPO and Emcure Pharma Rs 1,952 crore IPO opened for subscription today. 

The BSE Sensex is currently trading at 79259.85, down by 216.34 points or 0.27% after trading in a range of 79236.74 and 79855.87. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.34%, while Small cap index was up by 0.12%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 0.99%, Energy up by 0.77%, IT up by 0.43%, TECK up by 0.38% and Realty up by 0.32%, while Bankex down by 0.86%, Auto down by 0.59%, Telecom down by 0.37%, Consumer discretionary down by 0.34% and Consumer Durables down by 0.33% were the top losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 0.93%, Infosys up by 0.77%, TCS up by 0.57%, HCL Technologies up by 0.56% and Bharti Airtel up by 0.43%. On the flip side, Kotak Mahindra Bank down by 1.96%, Bajaj Finance down by 1.73%, Tata Motors down by 1.66%, ICICI Bank down by 1.15% and Axis Bank down by 1.13% were the top losers.

Meanwhile, expressing hopefulness over the country’s rainfall situation, the India Meteorological Department (IMD) has said that India could experience above-normal rainfall in July, except for parts of the northeastern region. IMD chief Mrutyunjay Mohapatra said July rainfall averaged over the country as a whole is most likely to be above normal - more than 106 per cent of the long-period average of 28.04 cm. He added ‘Normal to above-normal rainfall is most likely over most parts of the country except many parts of northeast India and some parts of northwest, east, and southeast peninsular India’.

IMD said maximum temperatures are likely to be normal to below normal over many parts of northwest India and south peninsular India, except the west coast. Above-normal maximum temperatures are likely over many parts of central India, east and northeast India, and along the west coast. It added the minimum temperatures are most likely to be above normal over many parts of the country except some parts of northwest and the adjoining areas of central India, and some pockets of southeastern peninsular India.

It noted northwest India recorded its warmest June last month since 1901, with a mean temperature of 31.73 degrees Celsius. The monthly average maximum temperature in the region settled at 38.02 degrees Celsius, 1.96 degrees Celsius above normal. According to IMD data, the average minimum temperature stood at 25.44 degrees Celsius, 1.35 degrees Celsius above normal. Northwest India recorded a mean temperature of 31.73 degrees Celsius in June, 1.65 degrees Celsius above normal and the highest since 1901.

In June, India recorded below-normal rainfall in June, with the deficit standing at 11 per cent, the highest in five years. According to the IMD data, the country received 147.2 mm of rainfall against a normal of 165.3 mm for the month, the seventh lowest since 2001. June rainfall accounts for 15 per cent of the total precipitation of 87 cm recorded during the four-month monsoon season in the country.

The CNX Nifty is currently trading at 24109.85, down by 32.10 points or 0.13% after trading in a range of 24073.65 and 24236.35. There were 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were ONGC up by 2.02%, Coal India up by 1.65%, Wipro up by 1.32%, Infosys up by 1.15% and Power Grid up by 1.11%. On the flip side, Kotak Mahindra Bank down by 1.90%, Bajaj Finance down by 1.65%, HDFC Life Insurance down by 1.62%, Shriram Finance down by 1.58% and SBI Life Insurance down by 1.39% were the top losers.

Asian markets are trading mostly in green; Nikkei 225 surged 265.07 points or 0.67% to 39,896.13, Hang Seng advanced 100.89 points or 0.57% to 17,819.50, Straits Times rose 16.02 points or 0.48% to 3,354.59, Jakarta Composite gained 12.05 points or 0.17% to 7,151.68 and Shanghai Composite was up by 1.05 points or 0.04% to 2,995.78. On the other hand, Taiwan Weighted lost 154.7 points or 0.67% to 22,903.87 and KOSPI dropped 24.92 points or 0.89% to 2,779.39.