Major bourses remain in tight range; Automakers slump

Key domestic benchmarks continue to trade in a tight range with minor losses in the absence of any significant trigger. Sentiments remained down-beat since beginning on account of sluggish core sector data. Selling in automobile space too was dampening the sentiments as stocks like Tata Motors, Bajaj Auto, Maruti Suzuki and Ashok Leyland edged lower after reporting lower sales numbers in June due to slow down in demand. Powers stocks too were reeling under pressure led by India’s largest private power producer Tata Power Company, down by about one and a half percent after global credit rating agency Moody’s Investors Service downgraded the company’s outlook to negative from stable. However, losses remained capped as Indian Rupee recovered by 11 paise in afternoon trade on dollar selling by banks and exporters as foreign funds continued pouring capital into domestic equities. The down-side also remained limited after Oil marketing companies reacted positively to the diesel price hike.

Global cues remained un-supportive with European markets opening in the red with CAC and FTSE sliding by about quarter a percent in early deals. Asian markets too were trading mostly in the red as investors treaded cautiously at higher levels amid concerns about the Chinese economy. Back home, on the sectoral front, consumer durables witnessed the maximum gain in trade followed by healthcare and metal, while realty, software and public sector undertaking remained the top losers on the BSE sectoral space. The broader indices, however, were continued to outperform benchmarks. The overall market breadth on BSE is in the favour of declines which have thumped advances in the ratio of 971: 1057; while 127 shares remained unchanged.

The BSE Sensex is currently trading at 19553.12, down by 24.27 points or 0.12% after trading in a range of 19589.14 and 19499.21. There were 13 stocks advancing against 17 declines on the index.

The broader indices continued to trade in fine contour; the BSE Mid cap and Small cap indexes were trading up by 0.03% and 0.18% respectively.

The gaining sectoral indices on the BSE were, Consumer Durables up by 1.91%, Health Care up 0.74% Metal up by 0.43% and Oil & Gas up by 0.13%, while Realty down by 0.82%, IT down by 0.53%, PSU down by 0.45%, Auto down by 0.44% and Teck down by 0.30% were the top losers on the sectoral index.

The top gainers on the Sensex were Gail India up by 2.52%, BHEL up by 2.18%, Sterlite Industries up by 2.13%, Bharti Airtel up by 2.05% and Hindalco Industries up by 2.01%. On the flip side, Coal India down by 1.74%, Jindal Steel down by 1.70%, Tata Power down by 1.47%, Hero MotoCorp down by 1.30% and Tata Motors down by 1.26% were the top losers on the Sensex.

Meanwhile, in a move to attract larger number of foreign investors to Indian capital market, the Securities and Exchange Board of India (SEBI) panel has suggested that the government should bring more clarity and certainty in the taxation provisions for the newly proposed overseas investor category - Foreign Portfolio Investors (FPIs). The panel headed by former cabinet secretary K M Chandrasekhar was formed with an aim to attract foreign investments and has submitted its proposals to SEBI last month with SEBI board approved most of its recommendations and has decided to consult the government on some of the issues.

The panel recommended that the various classes of foreign investors, including FIIs (Foreign Institutional Investors), sub-accounts and qualified foreign investors (QFIs), could be merged into FPI to put in place a simplified and uniform set of entry norms for them. Further, it had also proposed to split FPIs into three categories. Among these categories, category I includes low risk (central banks, sovereign wealth funds),  category II - moderate risk (regulated entities such as banks, asset management companies, broad based funds already registered with SEBI) and category III - high risk and has kept the KYC formalities minimal compared to the first two categories.

Foreign investment is considered crucial for economic development of a country and to attract maximum foreign investment into the country, the government has been liberalizing the foreign investment policy. Recently, Foreign Institutional Investors (FIIs) have been pulling out money from Indian market owing to the global uncertainties, resulting into record fall in rupee value to over 60 per dollar. The FIIs combined outflow (equity plus debt) reported at Rs 44,161 crore in June.

The CNX Nifty is currently trading at 5,890.15, down by 8.70 points or 0.15% after trading in a range of 5,898.80 and 5,869.35. There were 20 stocks advancing against 30 declines on the index.

The top gainers of the Nifty were Lupin up by 3.58%, IDFC up by 2.82%, BHEL up by 2.04%, GAIL up by 1.99% and Sesa Goa up by 1.85%. On the flip side, DLF down by 2.41%, Coal India up by 2.13%, Rel Infra down by 2.05%, Jindal Steel down by 1.77% and Tata Power down by 1.69% were the major losers on the index.

Most of the Asian equity indices were trading in red; Hang Seng dipped 0.19%, Jakarta Composite declined 0.87%, KLSE Composite slipped 0.26%, KOSPI Composite was down by 0.04% and Taiwan Weighted was down by 0.25%.

On the flip side, Shanghai Composite up by 0.30%, Nikkei 225 rose 1.78%, Straits Times surged 1.20%.

European markets have got off to a negative start; with CAC 40 declining 0.28%, FTSE 100 sliding by 0.17% and DAX losing 0.11%.