Benchmarks trade marginally in red in afternoon session

Indian equity benchmarks were trading near the neutral line with a negative bias in the afternoon session as investors opted to remain on sidelines ahead of key results lined up later in the day. The corporate like SBI, Sun Pharma, M&M, Tata Steel and Coal India will announce their September quarter earnings results today. Weak macro-economic data such as Index of industrial production (IIP) and CPI inflation continued to weigh on sentiments. Further, weak Asian cues also added to the pessimistic sentiments. However, market losses remain capped as selling witnessed in banking, consumer goods and realty stock was offset by the gain in healthcare, consumer durables and auto stocks. On stock specific movements, Sun Pharma, Tata steel and Mahindra and Mahindra were trading higher on BSE amid hopes of better than expected result for Q2 FY14. Among other stocks, Tata Global Beverages has dipped around 6% after reporting a 51% year-on-year growth in consolidated profit for Q2 FY14 due to exceptional gains of Rs 92 crore. Meanwhile, Jet Airways surged around 5% after the fair trade regulator, Competition Commission of India (CCI), cleared the proposed 24% stake sale of the company to Abu-Dhabi-based Etihad Airways.

On the global front, Asian markets were trading in red with Japanese indices Nikkei down by 0.14% and KLSE Composite down by 0.43% amid uncertainty when the US Fed might start pruning its monetary stimulus measures. Back home, the NSE Nifty and BSE Sensex were trading down their psychological 6,050 and 20,500 levels respectively. The market breadth on BSE was negative, out of 2,116 stocks traded, 905 stocks advanced, while 988 stocks declined on the BSE.  

The BSE Sensex is currently trading at 20,256.30 down by 25.61 points or 0.13% after trading in a range of 20,345.81 and 20,224.91. There were only 14 stocks advancing against only 16 declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.16%, while Small cap index down by 0.18%.

The gaining sectoral indices on the BSE were Healthcare up by 1.10%, Consumer Durables up by 0.72%, Auto up by 0.37%, Teck up by 0.27% and Power up by 0.26%. While, Bankex down by 0.93%, Capital Goods down by 0.80%, Realty down by 0.26%, PSU down by 0.21% and FMCG down by 0.18% were the losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 3.66%, Hindalco Inds up by 1.66%, Tata Steel up by 1.50%, Hindustan Unilever up by 1.50% and BHEL up by 1.37%. On the flip side, Gail India down by 1.96%, L&T down by 1.77%, HDFC Bank down by 1.73%, SSLT down by 1.72% and Hero Moto Corp down by 1.56% were the only losers on the Sensex.

Meanwhile, concerned over the rising inflation in the country, India Inc has said the Government must immediately address supply side bottlenecks to contain the consumer price inflation. The consumer price index (CPI) or retail inflation for the month of October accelerated to 10.09% from a year earlier. The rise in inflation has been primarily driven by food article prices, which accelerated to 12.56% against 11.44% in September due to the supply disruptions resulted from heavy monsoon and poor storage facilities in the country.

CII Director General Chandrajit Banerjee, emphasized high retail inflation a threat for domestic economic recovery and expressed need to address structural issues, which are creating supply side hurdles in the way of growth. Assocham Secretary General D S Rawat said that despite a good monsoon in current year, high inflation around 12 percent inflation in cereals and around 45 percent in vegetable prices is quite surprising and disgusting. Terming the escalation in the CPI inflation a worrying factor for India, President of PHD Chamber of Commerce Suman Jyoti Khaitan said that high inflation is due to the severe problem in supply side management as production is not reaching consumers' doorsteps easily, thus it can be tackled only by easing supply side constraints and improving infrastructure rapidly. Further, rising inflation has also become an issue for the reserve bank of Indian (RBI), which has been increasing repo rate over the past few months in order to trim inflation as it has been eroding consumers and business confidence in the country.

Referring to the industrial production, India Inc has said that 2% rise in industrial output was not enough to conclude that recovery is on the cards as manufacturing growth would remain subdued in coming months. Indian industrial production (IIP) grew by 2% at 166.3 in the month of September over the corresponding month of previous year with capital goods production, a barometer for investments in the economy, witnessed a contraction of 6.8% at 231.7 for September as against 248.7 in the same month of the previous year. FICCI President Naina Lal Kidwai said Indian manufacturing sector is likely to witness subdued growth in the October-December quarter of current fiscal particularly due to the concerns over high interest rates and current slowdown in domestic demand. Suman Jyoti Khaitan, the President of PHD Chamber of Commerce, said that negative growth in capital goods indicates that investment cycle in the country is still in the fragile territory, which needs to revive with reduced costs of funds by rate cut and reduced costs of doing business by improving regulatory environment.

The CNX Nifty is currently trading at 6,010.80 down by 7.25 points or 0.12% after trading in a range of 6,033.00 and 5,994.25. There were 24 stocks advancing against 26 declining on the index.

The top gainers of the Nifty were Sun Pharma up by 3.91%, Hindalco up by 1.98%, Hindustan VR up by 1.65%, Tata Steel up by 1.65% and BHEL up by 1.40%. On the flip side, GAIL down by 2.02%, Asian Paints down by 1.98%, SSLT down by 1.93%, IDFC down by 1.81% and L&T down by 1.76% was the major loser on the index.

The Asian equity indices were trading in red; Nikkei 225 down by 0.14%, Shanghai Composite down by 1.32%, Taiwan Weighted down by 1.11%, Seoul Composite down by 1.37%, KLSE Composite down by 0.43%, Straits Times down by 0.45%,Hang Seng down by 1.54% and Jakarta Composite down by 1.95%.