Benchmarks slip to day’s low overlooking positive start of European markets

Overlooking positive start of the European markets, benchmark Indian equity indices continue to struggle and are currently trading near day’s low in absence of any positive domestic triggers. Lack of investors’ confidence, largely dented by Rupee’s volatility and current state of economy is weighing right from the start of the trade. Although, benchmarks managed to break-out in green in late morning deals, the recovery turned out to be momentary as profit-booking soon gripped the markets.

In this lackluster session of trade, only stocks from Consumer Durable, Information Technology and Oil & Gas have found some footing in the positive terrain, while those from Metal, Power and Fast Moving Consumer Goods continue to top the list of sellers. Trading near day’s lows, Sensex and Nifty are oscillating below the crucial 19,300 and 5750 levels respectively. Facing accentuated selling pressure, broader indices are trading with a cut of over half a percent.

On the global front, borrowing positive cues from Asian counterparts, European shares have extended gains to set a new two-month high on Friday, with investors betting that US jobs numbers will also surprise on the positive side and signal a further pick-up in economic activity in the country. Back home, the BSE Sensex is currently trading at 19280.22, down by 39.67 points or 0.19% after trading in a range of 19,451.70 and 19255.17. There were 11 stocks advancing against 19 declines on the index. The overall market breadth BSE is in the favour of declines which have thumped advances in the ratio of 1241:683; while 117 shares remained unchanged.

The broader indices were trading in red; the BSE Mid cap and Small cap indices were trading lower by 0.45% and 0.68% respectively.

The top gaining sectoral indices on the BSE were, Consumer Durable up by 4.46%, IT up by 1.52%, Oil & Gas up by 1.17% and TECk up by 1.07%. While Metal down by 4.17%, Power down by 3.07%, PSU down by 2.16%, FMCG down by 1.24% and Auto down by 0.91% were the top losers indices on the BSE.

The top gainers on the Sensex were Wipro up by 2.82%, RIL up by 2.31%, TCS up by 1.75%, BHEL up by 1.23% and Infosys up by 1.17%. On the flip side, Jindal Steel down by 9.10%, Coal India was down by 5.97%, Sterlite Inds was down by 4.85%, Hindustan Unilever down by 3.25% and Tata Steel down by 2.62% were the top losers on the Sensex.

Meanwhile, in a major move to depoliticise fixing of passenger tariffs by Indian Railways, the Union Cabinet has given an in-principle approval to the proposal of setting up Rail Tariff Authority (RTA) for fare rationalization. However, the final nod was with held for want of clarifications on various aspects like powers of the new body.

As per the deliberation, though the eventual notification for changes in tariff after the discussions would still be done by the Railways, the authority which is expected to have five independent members, including a chairman, would set strong guiding principles for changes and in that respect and would be more than just a recommending body.

The proposal, which was mooted by former Railway Minister and Trinamool Congress MP Dinesh Trivedi in his Rail Budget 2012-13, was pursued by his successors CP Joshi, Pawan Kumar Bansal and the present occupant Mallikarjun Kharge.

The need for this proposal was largely felt on account of rise in cost of running trains and the need to insulate the Railways from hikes in fuel and electricity and eliminating uncertainties in tariff formulation. Surprisingly, in 1950, railways were earning 47% of its revenue from passengers which has gone down substantially to 27% presently.

Meanwhile, RTA would be one of the first steps towards depoliticisation of Indian Railways, which ended on an operating ratio of 88.8% for the year of 2012-2013. The cross subsidisation for passenger service had gone up to Rs 36,000 crore in 2012 which was reduced to Rs 32,000 crore after the latest hike in passenger fares and cancellation charges.The CNX Nifty is currently trading at 5,710.05, down by 17.80 points or 0.31% after trading in a range of 5,761.85 and 5,701.75. There were 18 stocks advancing against 32 declines on the index.

The top gainers of the Nifty were Ranbaxy up by 4.00%, ACC up by 3.43%, Ambuja Cement up by 3.22%, Indusind Bank up by 3.09% and Reliance up by 2.35%. On the flip side, Power Grid down by 14.58%, Jindal Steel down by 9.34%, Coal India down by 5.94%, Bank of Baroda down by 4.87% and BPCL down by 4.68% were the major losers on the index.

The Asian equity indices were trading in green; Shanghai Composite up by 0.05%, Hang Seng up by 0.54%, Jakarta Composite up by 0.11%, Nikkei 225 up by 3.29%, Seoul Composite up by 0.14%, Taiwan Weighted was up by 0.54%, KLSE Composite up by 0.14% and Straits Times up by 0.62%.

European markets got off to a positive start; with CAC 40 adding 0.07%, DAX rising by 1.63% and FTSE 100 gaining 0.17%.