Benchmarks trade marginally lower in afternoon session

Indian equity benchmarks were marginally down in afternoon session amid profit booking witnessed in blue chip stocks such as Reliance Industries and private banks. Investors also remained on sidelines ahead of Infosys Q2 FY14 numbers scheduled to be announced tomorrow. Investors’ sentiments were also dented after International Monetary Fund (IMF) has said that emerging economies including India may not be able to return to growth rates of 8 percent and more under present circumstances. Further, IMF also concerned over the country’s fiscal deficit outlook, said India's fiscal deficit is likely to increase to 8.5 percent of the GDP this fiscal. However, market losses remained capped as sentiments got some support after Planning Commission Deputy Chairman Montek Singh Ahluwalia’s said that India’s GDP will see a turnaround in the coming quarters on the back of strong agricultural production and various steps taken by the government to spur growth. Buying was witnessed in Metal, Auto and Reality stocks. Auto shares were among the top gainers on BSE on hopes of revival in vehicle demand after banks started reducing interest rates on retail loans.

On the global front, Asian markets were trading mixed as the continuing shutdown in the US over the budget and raising of debt ceiling weighed on investor sentiment. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,000 and 20,000 levels respectively. The market breadth on BSE was positive, out of 2,041 stocks traded, 1163 stocks advanced, while 748 stocks declined on the BSE.     

The BSE Sensex is currently trading at 20,223.91 down by 25.35 points or 0.13% after trading in a range of 20,323.77 and 20,135.91. There were only 15 stocks advancing against 15 declines on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.62%, while Small cap index up by 0.49%.

The gaining sectoral indices on the BSE were Metal up by 0.92%, Auto up by 0.80%, Realty up by 0.71%, IT up by 0.35% and Helathcare up by 0.30%. While, Oil and Gas down by 0.58% and Bankex down by 0.36% were remained the only losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 1.82%, SSLT up by 1.57%, M&M up by 1.26%, Maruti Suzuki up by 1.26% and Jindal Steel up by 1.21%. On the flip side, Tata Power down by 1.51%, HDFC Bank down by 1.36%, RIL down by 1.00%, Gail India down by 0.99% and Sun Pharma down by 0.82% were the only losers on the Sensex.

Meanwhile, raising concerns over the prevailing global economic downturn, International Monetary Fund (IMF) has said that emerging economies including India may not be able to return to growth rates of 8 percent and more under present circumstances. Conversely, the government is committed to get the Indian economy back to its potential growth rate of 8-9 percent. The country economic growth has slowed down dramatically to decade low of 5 percent last fiscal year after recording an average of nearly 8 percent over the last nine fiscal years.

IMF has also cut Indian economic forecast to 3.75 percent in 2013 from 5.7 percent projected earlier citing that poor manufacturing and service sector performance coupled with rising inflation could adversely affect the economy’s growth in the current fiscal. Meanwhile, the government has rejected IMF's growth projections of 3.75 percent for the current fiscal, saying that the country is witnessing turnaround both in terms of growth in manufacturing and domestic demand and buoyancy in exports. Therefore, domestic economic growth will exceed 5 percent in current fiscal.

Further, presenting a somber picture of India's fiscal deficit outlook, IMF said that India's fiscal deficit is likely to increase to 8.5 percent of the GDP this fiscal, mainly due to the downward revision in GDP growth, depreciation of rupee and higher global oil prices. Widening fiscal deficit has become a cause for concern for India and the government is taking measures to rein in spending and cut subsidies to meet its fiscal deficit target at 4.8 percent of GDP in the current financial year. In the first five months of this fiscal, country’s fiscal deficit has already touched around three-fourths of the budget estimate. 

The CNX Nifty is currently trading at 6,003.45 up by 4 points or 0.07% after trading in a range of 6,031.80 and 5,979.80. There were 28 stocks advancing against 22 declines on the index.

The top gainers of the Nifty were Ranbaxy up by 3.53%, Asian Paints up by 2.16%, NMDC up by 2.04%, DLF up by 1.53% and SSLT up by 1.63%. On the flip side, Tata Power down by 1.51%, HDFC Bank down by 1.46%, Kotak Mahindra Bank down by 1.15%, Reliance down by 1.03% and Sun Pharma down by 1.00% were the major losers on the index.

The Asian equity indices were trading mixed; Jakarta Composite up by 0.62%, Straits Times up by 0.50%, Nikki 225 up by 1.12% and KLSE Composite up by 0.31%. While, Hang Seng down by 0.83%, Taiwan Weighted down by 0.37%. Seoul Composite down by 0.07%, and Shanghai Composite down by 0.70%.