Markets drift lower in early trade on Tuesday

Snapping two days northward journey, Indian equity benchmarks have made a cautious start in Tuesday’s morning deals as global cues remain mixed with investors across the globe awaiting Wednesday’s monetary-policy decision by the Federal Open Market Committee (FOMC). The US markets ended higher overnight as traders took cues from some upbeat economic data; homebuilder confidence jumped to a seven-year high, while the regional manufacturing rose more than expected. Though, Asian markets were trading mixed at this point of time with Chinese market declining in early deals led by developers on concern that gains in home prices will limit scope for monetary easing.

Back home, sentiments also remain dampened after the rupee plunged by 56 paise, or almost 1%, to trade at 58.43 against the dollar in early trade at the Interbank Foreign Exchange market due to renewed dollar demand from importers and appreciation of the US currency overseas. Selling in power counter also dented sentiments. Stocks like Adani Power, Reliance Power, NTPC, NHPC and BHEL declined after the Ministry of Coal (MoC) issued show cause notices to two more coal blocks in Odisha over delay in developing the mines, continuing its crackdown on non-serious allocatees. Bucking the trend, shares of telecom services provider are trading higher by up to 2% in otherwise subdued market after the Telecom Regulatory Authority of India (TRAI) announced reduction in the national mobile phone roaming charges, but said there will be no free national roaming as of now.

On the sectoral front, realty witnessed the maximum gain in trade followed by technology and software, while consumer durables, banking and oil and gas remained the top losers on the BSE sectoral space. The broader indices were outperforming benchmarks, while the market breadth on the BSE was positive; there were 671 shares on the gaining side against 507 shares on the losing side while 52 shares remain unchanged.

The BSE Sensex opened at 19,329.17; about 3 points higher compared to its previous closing of 19,325.87, and has touched a high and a low of 19,334.07 and 19,227.11 respectively.

The index is currently trading at 19,251.94, down by 73.93 points or 0.38%. There were 7 stocks advancing against 23 declines on the index.

The overall market breadth has made a strong start with 54.55% stocks advancing against 41.22% declines. The broader indices too were trading in green; the BSE Mid cap and Small cap indices up by 0.24% and 0.31% respectively. 

The only gaining sectoral indices on the BSE were, Realty up by 1.85%, Teck up by 0.49%, IT up by 0.33% and Health Care up by 0.05%, while Consumer Durables down by 0.76%, Bankex down by 0.67%, Oil & Gas down by 0.34%, PSU down by 0.31% and Auto down by 0.28% were the top losers on the sectoral index.

The top gainers on the Sensex were Bharti Airtel up by 0.94%, Bajaj Auto up by 0.82%, Hero MotoCorp up by 0.69%, Tata Steel up by 0.65% and Infosys up by 0.46%.

On the flip side, Tata Motors was down by 1.52%, HDFC was down by 0.95%, HDFC Bank was down by 0.93%, ICICI Bank was down by 0.92% and Gail India was down by 0.90% were the top losers on the Sensex.

Meanwhile, in a big relief to the highway developers, the Ministry of Road Transport and Highways is preparing a proposal which will help them to exit projects without punitive measures, as Under a clause of Substitution (Agreement) in the Model Concessionaire Agreement, the lenders of the project will be the one to decide the exit of the developer and can choose the new firm as developer.

Substitution agreement is between the National Highway Authority of India (NHAI), which is responsible for the development, maintenance and management of National Highways entrusted to it, lenders and the Concessionaire (developer). As per the provisions of the agreement, NHAI and the Concessionaire will have the right for the substitution of the Concessionaire in accordance with the provisions of the agreement.

However, this proposal will go to the Cabinet Committee on Economic Affairs for final approval, once all the ministries send their comments. Earlier there was proposal to allow developers to fully exit the projects or partially divest equity in the road project with the approval from the stakeholders.

The CNX Nifty opened at 5,841.90; about 8 points lower as compared to its previous closing of 5,850.05, and has touched a high and a low of 5,843.95 and 5,815.15 respectively.

The index is currently trading at 5,824.75, down by 25.30 points or 0.43%. There were 11 stocks advancing against 39 declines on the index.

The top gainers of the Nifty were DLF up by 1.11%, Bharti Airtel up by 1.00%, Bajaj Auto up by 0.79%, Tata Steel up by 0.61% and Hero MotoCorp up by 0.48%.

On the flip side, UltraTech Cement down by 2.42%, Ranbaxy Laboratories down by 2.24%, Tata Motors down by 1.60%, Gail down by 1.10% and Grasim down by 1.06% were the major losers on the index.

Asian equity indices were trading mixed; Jakarta Composite surged 77.26 points or 1.62% to 4,851.77, Straits Times soared 36.65 points or 1.15% to 3,220.09, KOSPI Composite rose 6.03 points or 0.32% to 1,889.13 and Taiwan Weighted was up by 27.27 points or 0.34% to 8,020.16.

On the flip side, Shanghai Composite slipped 4.65 points or 0.22% to 2,151.56, Hang Seng dropped 135.81 points or 0.64% to 21,090.09, KLSE Composite dipped 0.54 points or 0.03% to 1,771.63 and Nikkei 225 was down by 29.07 points or 0.22% to 13,004.05.