Weak trade prevails; Consumer Durables, Metal drag markets

Indian equity markets pared minor losses but continued its weak trade in the late afternoon session on account of selling in front line blue chip counters and taking cues from European counterparts. The sentiments on the street turned pessimistic after rupee hit a new all-time low of 58.90 on persistent dollar demand from importers and banks as well as heavy capital outflows amid weak local equities. Brokerage house Nomura expects India’s current account deficit to widen to a record high of $21 billion in May, compared to $17.8 billion in April. Traders were seen selling in Consumer Durables (CD), Metal and Realty sector stocks. In the scrip specific development, Jindal Steel & Power (JSPL) was trading deep in red after touching 52-week low after the Central Bureau of Investigation (CBI) lodged FIR against 4 companies including JSPL in coal gate scam. Reliance Communications was trading in red after Standard Chartered downgraded the company’s rating to underperform from in-line, saying current valuations fully reflect the upside from the optic fiber and tower deals. Elder Pharmaceuticals was locked at upper circuit limit after the company mandated a multinational consultancy firm and a Japanese investment banking firm to manage a formal process to find a buyer through a negotiated transaction.

On the global front, the Asian markets were trading in red while the European markets were too trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 5,850 and 19,300 levels respectively. The market breadth on BSE was negative in the ratio of 513:1639, while 131 scrips remain unchanged. 

The BSE Sensex is currently trading at 19,241.00, down by 200.07 points or 1.03% after trading in a range of 19,418.74 and 19,121.18. There were 10 stocks advancing against 20 declines on the index.

The broader indices pared some loss; the BSE Mid cap index was down by 1.49% and Small cap index was down by 1.86%.

There were no gaining sectoral indices on the BSE while Consumer Durables down by 3.62%, Metal down by 3.59%, Realty down by 3.47%, Power down by 1.55% and Auto down by 1.50% were the top losers on the BSE.

The top gainers on the Sensex were Cipla up by 1.33%, Gail India up by 0.79%, Hero MotoCorp up by 0.76%, NTPC up by 0.73% and Bajaj Auto up 0.49%. On the flip side, Jindal Steel down by 15.42%, Tata Power down by 5.36%, Hindalco Industries was down by 4.97%, Mahindra & Mahindra down by 3.62% and ICICI Bank down by 3.44%were the top losers on the Sensex.

Meanwhile, in a move to create job opportunities for women in the country, the finance ministry is likely to approach the cabinet for approval to set up India's first all-women bank, entailing Rs 1,000 crore initial investments. All-women bank, proposed in Budget, would be wholly-owned by the government and is expected to start operations from November, 2013 through six branches in different parts of the country.   

The bank, mostly manned by women, would start with an initial capital of Rs 1,000 crore and initially there would be one branch in each major region of the country - South, West, East, Centre, North and the North-east. Further, the proposed bank will lend mostly to women and women-run businesses and provide support to women Self Help Groups (SHGs) and their livelihood. 

Moreover, all-women bank will employ predominately women, which addresses the gender-related issues, women empowerment and financial inclusion. Meanwhile, it will take deposits from both men and women.

Further, the government is also soon planning to open All-Women Post Offices. The Department of Post-office (DoP) has planned to set up at least three to four All-Women post offices in all the metros and a minimum of one such PO in Tier-II cities. The move will start from the urban centres and then slowly cover the other areas. 

The CNX Nifty is currently trading at 5,816.15, down by 61.85 points or 1.05% after trading in a range of 5,868.05 and 5,781.80. There were 14 stocks advancing against 36 declines on the index.

The top gainers of the Nifty were HCL Technologies up by 1.54%, Hero MotoCorp up by 1.26%, Bank of Baroda up 1.24%, Cipla up by 1.04% and GAIL India up by 0.95%. On the flip side, Jindal Steel down by 15.62%, Tata Power down by 5.42%, Hindalco Industries down by 5.02%, DLF down by 4.74% and M&M down by 3.49% were the major losers on the index.

All the Asian equity indices were trading in red; Hang Seng declined 1.20%, KLSE Composite declined by 0.21%. Straits Times crumbled 0.95%, KOSPI Composite dropped 0.62%, Taiwan Weighted slid 0.54%, Jakarta Composite lost 4.16% and Nikkei 225 dropped 1.45%

Markets in China remained closed for the trade on account of Dragon Boat Festival holiday.

The European markets were trading in red; France’s CAC 40 was down 0.74%, Germany’s DAX lost 0.83% and the United Kingdom’s FTSE 100 edged lower 0.71%.