Benchmarks add losses; Nifty below 5,950 mark

Indian equity markets added losses to continue their weak trade in late afternoon session on account of selling in front line blue chip counters and taking cues from European counterparts. Traders were seen piling positions in Auto stocks while selling was witnessed in FMCG, Power and Capital Goods sector stocks. In scrip specific development, Hero MotoCorp, the country’s biggest two-wheeler manufacturer, was trading in green after the company stated that it may look at increasing its stake in its US-based partner Erik Buell Racing (EBR). The company’s adjusted operating margins for June-quarter came in at 14.85%, higher than the estimates of about 13%. Elder Pharmaceuticals was trading in green on reports that Sanofi’s India unit and the Carlyle group are in separate talks to buy the domestic drug formulations business of the company for $400-450 million. The market may remain volatile today as traders may roll over positions in the futures & options (F&O) segment from the current month series i.e. July 2013 series to next month series i.e. August 2013 series. The near month July 2013 derivatives contracts will expire today i.e. July 25, 2013.

On the global front, all the Asian markets were trading in red barring KLSE Composite while the European markets were too trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 5,950 and 20,000 levels respectively. The market breadth on BSE was negative in the ratio of 741:1351, while 160 scrips remain unchanged. 

The BSE Sensex is currently trading at 19901.49, down by 189.22 points or 0.94% after trading in a range of 20110.81 and 19886.83. There were 11 stocks advancing against 19 declines on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.74% and Small cap index lost 0.69%.

The top gaining sectoral indices on the BSE were, Auto up by 0.75% while FMCG down by 3.05%, Power down by 1.15%, Capital Goods down by 0.94%, Metal down by 0.92% and Health Care down by 0.62% were the top losers on the sectoral index.

The top gainers on the Sensex were Hero MotoCorp up by 3.54%, Tata Motors up by 1.16%, Dr. Reddy’s Lab up by 0.79%, HDFC up by 0.78% and Infosys up 0.43%. On the flip side, Wipro was down by 4.98%, ITC was down by 4.08%, Hindustan Unilever was down by 4.07%, Tata Power down by 3.57% and Sterlite Industries down 2.38% were the top losers on the Sensex.

Meanwhile, the government has recently issued another Presidential directive to state-owned Coal India to enter into fuel supply agreements (FSAs) with power plants for a capacity of 78,000 MW. Still out of the total 131 power plants, 52 of are yet to sign FSA with State-owned CIL, long after the passing of the second deadline set by the Prime Minister’s Office for signing of FSAs by early this year. Only 79 power plants, so far, have entered into the fuel supply agreements with CIL.

The 52 power firms had earlier this year, failed to meet the second deadline set by the PMO for signing FSAs. PMO had in December last year directed that the remaining FSAs should be signed within a month’s time. The directive in December, 2012 came after the November, 2012 deadline for signing of FSAs was missed.

Last year, the Coal Ministry had issued a Presidential directive for the first time to CIL to sign FSAs with the power producers assuring them of at least 80 per cent of the committed coal delivery. Earlier, some power firms including NTPC had refused to enter into FSAs with CIL over quality issues of the dry- fuel supplied to it. NTPC had also stopped payment to Coal India’s subsidiary -- Eastern Coalfields. Responding to that, the world’s largest coal miner had temporarily stopped supply of fuel to NTPC which was resolved later following government’s intervention. Uptill now, NTPC and CIL have inked FSAs for 28 units, with one remaining. While, the companies are yet to complete FSA for a 500 MW joint venture thermal power plant of NTPC and SAIL at Bhilai.

The CNX Nifty is currently trading at 5,938.35, down by 52.15 points or 0.87% after trading in a range of 5,990.65 and 5,933.35. There were 20 stocks advancing against 29 declines while 1 stock remained unchanged on the index.

The top gainers of the Nifty were Hero MotoCorp up by 3.43%, BPCL up by 3.35%, Asian Paints up by 2.22%, IDFC up by 1.83% and PNB up by 1.63%. On the flip side, Ambuja Cements down by 12.06%, JP Associate down by 9.21%, Hindustan Unilever down by 4.35%, ACC down by 4.19% and ITC down by 4.06% were the major losers on the index.

All the Asian equity indices were trading in red barring KLSE Composite which was up 0.01%; while Shanghai Composite dipped 0.60%, Hang Seng declined 0.31%, Jakarta Composite contracted 0.95%, Nikkei 225 decreased 1.14%, Straits Times shed 1.01%, Seoul Composite was down by 0.13% and Taiwan Weighted was down by 0.40%.

The European markets were trading in red; France’s CAC 40 was down 0.27%, Germany’s DAX lost0.45% and the United Kingdom’s FTSE 100 edged lower by 0.29%.