Benchmarks continue to trade in red; Nifty below 5,800 mark

Indian equity markets pared minor losses but continued to stay below the neutral with weak trades as the CPI failed to convince investors to buy in front line blue chip counters in the late afternoon session. The sentiments turned pessimistic after country’s industrial output growth slowed in April, raising fresh concerns about the strength of the economy and adding pressure on the government to take steps to boost growth. Traders were seen piling position in Health Care and Bankex stocks while selling was witnessed in Consumer Durables, Metal and FMCG sector stocks. In the scrip specific development, Titan Industries was seen trading deep in red after the Reserve Bank of India extended gold import restrictions to all nominated agencies involved in gold imports. Wockhardt was trading in red with the stock extending yesterday’s slide triggered by reports that the health ministry has suspended the sale and distribution of Dextropropoxyphene, a pain-relieving drug. MMTC was trading weak on reports that the panel of ministers on disinvestment is likely to meet today, i.e. June 12, 2013 to decide the base price for stake-sale in the state-run trading firm.

On the global front, most of the Asian markets were trading in red barring Jakarta Composite while the European markets were trading on a mixed note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 5,800 and 19,100 levels respectively. The market breadth on BSE was negative in the ratio of 884:1295, while 139 scrips remain unchanged. 

The BSE Sensex is currently trading at 19,071.84, down by 71.16 points or 0.37% after trading in a range of 19,143.24 and 18,969.08. There were 11 stocks advancing against 19 declines on the index.

The broader indices pared some loss; the BSE Mid cap index was down by 0.32% and Small cap index was down by 0.27%.

The only gaining sectoral indices on the BSE were, Health Care up by 0.37% and Bankex up 0.06% while Consumer Durables down by 7.42%, Metal down by 1.51%, FMCG down by 0.83%, IT down by 0.75% and Auto down by 0.65% were the top losers on the BSE. 

The top gainers on the Sensex were Jindal Steel up by 2.39%, Cipla up by 1.01%, Tata Motors up 0.61%, ONGC up by 0.60%, and Gail India up by 0.52%. On the flip side, Coal India was down by 3.11%, Hero MotoCorp was down by 2.76%, Tata Steel was down by 2.29%, Bajaj Auto was down by 2.14% and Hindalco Industries was down by 1.85% were the top losers on the Sensex.

Meanwhile, amid the record fall of rupee value against dollar, the Finance Ministry has assured that the domestic currency will stabilize in the next 3-4 days with large foreign fund flows. Department of Economic Affairs (DEA) Secretary Arvind Mayaram said, weakness in rupee is a temporary phenomenon and in the coming days, foreign institutional investors (FIIs) would bring back funds into the debt segment which would help the rupee inch up from the current levels.

FIIs have pulled out more than Rs 7,600 crore from the Indian debt market in the first week of this month, mainly due to weakness of the rupee. FIIs were gross buyers of debt (Rs 2,487 crore), while they sold bonds worth Rs 10,162 crore resulting into a net outflow of Rs 7,675 crore during June 3-7.

By adding further Mayaram said, presently dollar is appreciating against all the currencies across the world and the rupee has not weakened as much as some of its peers with South African currency depreciating by 11 per cent. Meanwhile, assured that rupee would recover as the country’s economic fundamentals are strong and the government is taking steps to increase fund flows.

Recently, the rupee touched a life-time low of 58.98 against the US dollar. Further, the domestic currency has lost over 2.5 per cent in the two trading days of this week and nearly 10 per cent in the past six weeks owing to concerns over scaling down of stimulus packages by the US.

The CNX Nifty is currently trading at 5,772.85, down by 15.95 points or 0.28% after trading in a range of 5,792.90 and 5,738.60. There were 23 stocks advancing against 27 declines on the index.

The top gainers of the Nifty were JP Associates up by 2.94%, IndusInd Bank up by 2.54%, Jindal Steel up by 2.48%, IDFC up by 2.29% and BPCL up by 1.66%. On the flip side, Coal India down by 3.19%, Hero MotoCorp down by 2.90%, Axis Bank down by 2.80%, Tata Steel down by 2.29% and Bajaj-Auto down by 2.13% were the major losers on the index.

All the Asian equity indices were trading in red barring Jakarta Composite which was down by 1.43%, while KLSE Composite dropped 0.23%, Nikkei 225 tumbled 0.21%, Straits Times slipped 0.52% and KOSPI Composite was down by 0.56%.

Markets in China, Hong Kong and Taiwan remained closed for the trade today.

The European markets were trading on a mixed note; France’s CAC 40 was up 0.19%, Germany’s DAX lost 0.26% and the United Kingdom’s FTSE 100 edged lower 0.16%.