Benchmarks remain subdued; Investors tread with caution

Indian markets have extended losses after a weak start and were near day's low as traders booked profits after the recent upmove, tracking muted Asian markets. On the global front, The Asian equity indices were mostly in the red at this point of time as investors treaded cautiously at higher levels amid concerns about the Chinese economy. Back home, the traders were seen piling up positions in Health Care, Teck and Oil & Gas while selling was seen in Auto, Realty and Capital Goods sector.

In scrip specific developments, IT stocks fell for a second straight day, on worries around the immigration bill and its FY14 revenue guidance. Oil & Gas stocks edged higher after government hiked diesel price by 50 paisa per litre, the sixth increase in rates this year. Diesel in Delhi will cost Rs 50.84 per litre from tomorrow as against Rs 50.26 currently. In scrip specific actions, Elder Pharma surged after the company said its UK arm NutraHealth Ltd has acquired West Yorkshire-based firm Max Healthcare Ltd to re-enter over-the-counter pharmaceutical business for an undisclosed amount. Tata Motors dropped after the global auto giant said its total passenger vehicle sales in the domestic market stood at 11,804 units in June, down 31.54 per cent from 17,244 units in the same month last year . Tata Power tanked after the global credit rating agency Moody's Investors Service has downgraded the outlook on India's largest private power producer to negative from stable.

Meanwhile, the NSE Nifty and BSE Sensex were trading just above their psychological 5,850 and 19,500 levels respectively. The market breadth on BSE was showing positive trend with advances to declines in ratio of 865:763. The BSE Sensex is currently trading at 19535.37, down by 42.02 points or 0.21% after trading in a range of 19589.14 and 19505.98. There were 7 stocks advancing against 23 declines on the index. The broader indices were trading on green; the BSE Mid cap index was up by 0.06% and Small cap index was up by 0.28%.

The top gaining sectoral indices on the BSE were, Health Care up by 0.05%, Teck up by 0.05% and Oil & Gas up by 0.04% while Auto down by 0.80%, Realty down by 0.75%, Capital Goods down by 0.55%, Power down by 0.52% and PSU down by 0.36%, were the top losers on the BSE.

The top gainers on the Sensex were Bharti Airtel up by 2.49%, Gail India up by 1.52%, Sun Pharma up by 1.09%, Sterlite Inds up by 0.81% and ICICI Bank up by 0.78%. On the flip side, Jindal Steel was down by 2.82%, Tata Motors was down by 2.05%, Hero MotoCorp was down by 1.59%, BHEL was down by 1.20% and HDFC Bank was down by 1.07%  were the top losers on the Sensex.

Meanwhile, Growth in the eight core industries' slowed down to 2.3% in May as against 7.2% in the same month of previous year, reflecting slowdown in the economy. Among the eight core sectors, representing 38% weight in the Index of Industrial Production (IIP), crude oil, coal, natural gas and fertilizer sectors recorded negative growth in their output, while the other sector showed expansion in May, however substantially slowed when compared with same month a year ago.

On the positive side, Petroleum refinery production, representing 5.94% weight in IIP index grew by 5.0% in May, 2013 compared to 23.4% in May, 2012.  Cumulative growth of Petroleum refinery production during April-May, 2013-14 was 5.3% as compared to 22.1% recorded in the same period of previous fiscal. Electricity generation having 10.32% weight in index registered a growth of 6.2% in May, 2013 compared to 5.9% growth in May, 2012. On a cumulative basis, Electricity generation during April- May, 2013-14 was 4.9 % as compared to 5.6% during April-  May 2012-13.

Similarly, Steel and Cement sectors having weight of 6.68% and 2.41% in IIP index, registered growth of 4.1% and 3.0% in month under review against 3.8% and 15.4% growth in same month previous year. In cumulative terms, steel production Steel production was 3.0 % both during April to May 2013-14 and during April to May 2012-13. While, the growth of cement production was 5.6% in April-May, 2013-14 against 13.9% during the same period of previous fiscal.

On the flip side, crude oil, with weightage of 5.22% in index registered a negative growth of 2.4% in May, 2013 as compared to 0.5% growth in May, 2012. Cumulative growth of Crude Oil production during April-May 2013-14 was negative at 1.8% compared to de-growth of 0.4% during April-May 2012-13. Natural gas and fertilizer, having weight of 1.71% and 1.25% in IIP index, also registered negative growth of 18.7% and 2.0% in month under review against a de-growth of 10.7% and 15.1% in same month previous year. On cumulative basis, natural gas and fertilizer production during April-May 2013-14 was also negative at 18.1% and 2.2% compared to de-growth  of 11.0% and 12.4% during April-May 2012-13.

Further, coal production with weight of 4.38% in index registered a negative growth of 3.3% in May, 2013 compared to its growth at 9.6% in May, 2012. However, on cumulative basis, growth during April-May, 2013-14 was negative at 0.1% as compared to 7.8% growth during April- May 2012-13.

The CNX Nifty is currently trading at 5,880.25 down by 18.60 points or 0.32% after trading in a range of 5,898.80 and 5,873.05. There were 16 stocks advancing against 34 declines on the index.

The top gainers of the Nifty were Bharti Airtel up by 2.40%, Lupin up by 1.97%, IDFC up by 1.62%, Sun Pharma up by 1.39% and Gail up by 1.23%. On the flip side, Jindal Steel down by 2.62%, DLF down by 2.17%, Reliance Infra down by 2.05%, Tata Motors down by 1.92% and Ambuja Cements down by 1.80% were the major losers on the index.

Most of the Asian equity indices were trading in red; Shanghai Composite dropped 7.55 points or 0.38% to 1,987.70, Hang Seng dipped 90.24 points or 0.43% to 20,713.05, Jakarta Composite declined 37.09 points or 0.78% to 4,740.36, KLSE Composite slipped 3.20 points or 0.18% to 1,771.94, KOSPI Composite was down by 0.82 points or 0.04% to 1,854.91 and Taiwan Weighted was down by 20.20 points or 0.25% to 8,015.80.

On the flip side, Nikkei 225 rose 120.79 points or 0.87% to 13,988.19, Straits Times surged 29.63 points or 0.95% to 3,170.62.