Weak trade prevails; Nifty languishes around 5,400 mark

Indian equity markets added losses to continue weak trade in the late afternoon session on account of selling in front line counters and taking cues from weak European counterparts. The sentiments were pessimistic due to continuous selling pressure tailing Rupee’s sharp depreciation as investors anxiously wait for any fresh measures with Raghuram Rajan taking over the reins of RBI as the new governor on September 5. Traders were seen selling in Bankex, Consumer Durables and Oil & Gas stocks sector, as reports about the US gearing up for strikes against Syria came in. In scrip specific development, Tech Mahindra was trading in green after the Reserve Bank allowed the company to raise the purchasing limit of shares by foreign institutional investors in it by up to 35% of the paid up capital. United Breweries (Holdings) was trading in green after it filed a lawsuit seeking about $236 million in damages from engine-maker International Aero Engines AG for allegedly supplying inherently defective engines to Kingfisher Airlines (KFA). United Breweries (Holdings) is a founder group company of grounded carrier KFA.

On the global front, all the Asian markets were trading in green while the European markets were trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 5,450 and 18,500 levels respectively. The market breadth on BSE was negative in the ratio of 802:1251, while 125 scrips remain unchanged. 

The BSE Sensex is currently trading at 18488.34, down by 397.79 points or 2.11% after trading in a range of 19007.31 and 18427.69. There were only 7 stocks advancing against 23 declines on the index.

The broader indices were too trading in red; the BSE Mid and Small cap indices were trading lower by 0.87% and 0.39% respectively.

All sectoral indices were trading in red on BSE with Bankex down by 3.92%, Consumer Durables down by 2.87%, Oil & Gas down by 2.69%, FMCG down by 2.18%, and Capital Goods down by 2.02% were the top selling counters on BSE.

The top gainers on the Sensex were, Coal India up by 2.19%, Sesa Goa up by 1.78%, Wipro up by 1.62%, Tata Motors up by 1.10% and Mahindra & Mahindra up by 0.34%. On the flip side, Hero Moto Corp down by 4.57%, Reliance Industries down by 4.38%, ICICI Bank down by 4.33%, HDFC down by 4.16% and Sun Pharma down by 3.26% were the top losers on the Sensex.

Meanwhile, in order to ensure better monitoring and enforcement of public-private partnership (PPP) projects and to combat the negative perceptions hanging over such ventures, Planning commission has asked key infrastructure ministries including power, railways, road and shipping to set up dedicated PPP cells by November 30. Ministries, in consultation, with the planning commission and the finance ministry may specify the role and functions of these PPP cells.

Planning commission has suggested the ministries associated with infrastructure development that they should deploy full-time staff on such cells and allocate sufficient budgetary resources for hiring experts to maintain a tight vigil over the outcome of these projects. Further, it suggested the ministries to examine their selection and bidding procedures and asked the cabinet secretariat to create a standing group of experts to resolve differences that rise between the ministries. Planning commission's suggestions are aimed at building a competent institutional capacity to prevent the concessionaries from taking advantage of the loopholes in the mechanisms. 

The government has identified the development of infrastructure a most critical prerequisite for sustaining the present growth momentum of the economy. Meanwhile, investment in existing and new infrastructure projects involves high risks, low returns, huge capital, high incremental capital/ output ratio, long payback periods as well as superior technology. Hence, in order to bring in adequate resources for setting up of a sound and efficient infrastructural base, the government has entered into the 'Public Private Partnership (PPP)' programme.

The CNX Nifty is currently trading at 5,417.45, down by 133.30 points or 2.40% after trading in a range of 5,580.95 and 5,397.75. There were 8 stocks advancing against 42 declines on the index.

The top gainers of the Nifty were Lupin up by 2.46%, Coal India up by 2.07%, Sesa Goa up by 1.91% Tata Motors up by 1.12% and Cairn India up by 0.59%. On the flip side, Axis Bank down by 6.91%, IndusInd bank down by 5.96%, Asian paints down by 5.81%, Reliance Industries down by 4.71% and Punjab National Bank down by 4.57% were the major losers on the index.

All the Asian equity indices were trading in green; KLSE Composite up by 0.38%, Seoul Composite up by 0.46%, Jakarta Composite up by 1.10%, Taiwan Weighted up by 0.62%,  Shanghai Composite up by 1.18%, Hang Seng up by 0.99%, Nikkei 225 was up by 2.99% and Straits Times gained 0.08%.

The European markets were trading in red; France’s CAC 40 was down 0.27%, Germany’s DAX lost 0.31% and UK’s FTSE 100 dropped 0.01%.