Benchmarks trim losses; trade continues in red

Indian equities trimmed losses but continued their weak trade in the late afternoon session in absence of buying in front line counters. The sentiments remained subdued with retail Inflation data, which reversing two consecutive months’ easing trend spiked up to 9.84% in September as against 9.52% in the previous month. The latest data adds to the odds of Reserve Bank of India raising repo rates in the upcoming quarterly policy review on October 29, in order to do away with the sticky inflation. The street also took note of Morgan Stanley semi-annual survey of 95 institutional investors, which reported that investors have turned equal-weight on Indian stocks. The investment bank said that only 21% of the investors are overweight on India versus 39% in February, the lowest since it began this survey, while only one-third believe that India will beat emerging markets in the next 12 months. Traders were seen piling positions in Metal, TECK and IT stocks while selling was witnessed in Bankex, Consumer Durables and PSU sector stocks. In scrip specific development, Andhra Pradesh Paper Mills was trading in red after the paper manufacturer reported a net loss of Rs 45 crore in July-September quarter as against profit of Rs 7.5 crore in a year ago period.

On the global front, all the Asian markets were trading in green barring Shanghai Composite while the European markets were too trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,100 and 20,600 levels respectively. The market breadth on BSE was negative in the ratio of 852:1354 while 142 scrips remained unchanged.  

The BSE Sensex is currently trading at 20605.33, down by 2.21 points or 0.01% after trading in a range of 20,759.58 and 20,446.73. There were 14 stocks advancing against 16 declines on the index.

The broader indices too were trading in red; with BSE Mid Cap and Small Cap indices were trading lower by 0.78% and 0.62% respectively.

The gaining sectoral indices on the BSE were Metal up by 1.12%, TECK up by 0.97% and IT up by 0.87% while, Bankex down by 1.37%, Consumer Durables down by 1.11%, PSU down by 0.64%, Health Care down by 0.49% and Power down by 0.45% were the losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 3.46%, Bharti Airtel up by 3.20%, Wipro up by 2.65%, Hindalco Industries up by 1.45% and Infosys up by 0.80%. On the flip side, Tata Power down by 1.85%, GAIL India down by 1.30%, Hero MotoCorp down by 1.22%, ICICI Bank down by 0.97% and Sun Pharma down by 0.89% were the top losers on the Sensex.

Meanwhile, as per the Confederation of Indian Industry (CII) survey, Indian economic growth is likely to remain below 5 percent in the current fiscal. CII survey, based on the assessment of CEOs, indicated that ongoing economic slowdown has weighed down the confidence of India Inc as 42 percent of the respondents expected the economy to grow in the range of 4.5 to 5 percent. Further, 65 percent of the respondents expect that economic growth recovery will not take place before the second quarter of next fiscal.

Indicating that Indian economy is moving towards a situation of stagflation, the survey added that majority of the respondents (42 percent of CEOs) expected inflation to increase moderately in the second half of the year. Referring to the domestic currency, 53 percent of the respondents expected the rupee to prevail below 62 per dollar by the end of the current fiscal with current account deficit easing. Moreover, political uncertainty was ranked as the highest risk factor in coming future, affecting the business confidence of India Inc.

Regarding the country’s infrastructure sector, 56 percent of the respondents did not feel that the recently set up Cabinet Committee on Investment (CCI) had raised investments so far at the ground level. Meanwhile, in order to revive investment demand, industry body expressed the need for strengthening policy intervention by both the government as well as RBI, adding that the government should focus on stepping up capital expenditure whereas RBI should adopt a softer monetary stance.

The CNX Nifty is currently trading at 6,108.10, down by 4.60 points or 0.08% after trading in a range of 6,156.30 and 6,056.55. There were 17 stocks advancing against 32 declines while 1 stock remained unchanged on the index.

The top gainers of the Nifty were JP Associate up by 7.42%, Tata Steel up by 3.46%, Bharti Airtel up by 2.99%, Wipro up by 2.64% and Asian Paints up by 2.15%. On the flip side, IndusInd Bank down by 2.96%, Ranbaxy Laboratories down by 2.54%, Tata Power down by 1.98%, IDFC down by 1.92% and Bank of Baroda down by 1.86% were the major losers on the index.

The Asian equity indices were trading mostly in green; Hang Seng up by 0.51%, Nikkei 225 up by 0.26%, Seoul Composite up by 1.02% and Taiwan Weighted up by 1.14%. On the other hand, Shanghai Composite down by 0.19% was the sole loser.

Markets in Indonesia, Malaysia and Singapore remained closed for the trade today on account of holiday.

The European markets were trading in green; France’s CAC 40 was up 0.53%, Germany’s DAX added 0.60% and UK’s FTSE 100 gained 0.64%.