Benchmarks add losses; Power, Capital Goods drag

Indian equities added losses to continue weak trade in the late afternoon session on account of selling in front line counters. The sentiments were on pessimistic mood from the early trade after HSBC said it sees government breaching its FY14 fiscal deficit target of 4.8% on account of slower revenue and higher expenditure in the first half of the fiscal. Investors didn’t pay heeds on reports of Foreign funds buying Indian cash shares and derivatives worth $1 billion on Monday when the stock market rose to a record high after the Bharatiya Janata Party (BJP), widely seen by investors as being more business friendly, swept recent state elections. Traders were seen piling position in IT, TECK and FMCG stocks, while selling was witnessed in Power, Capital Goods and PSU sector stocks. Hectic activity was witnessed in power stocks after Central Electricity Regulatory Commission (CERC) released draft regulations, which will decide power tariffs for a period of five years from 1 April 2014. In scrip specific development, ITC was trading in green on plan to shake-up distribution of fast-moving consumer goods by rolling out its entire range of packaged food and personal care products through lakhs of paan shops across India.

On the global front, the Asian markets barring Jakarta Composite and KLSE Composite were trading in red, while the European markets were trading on a mixed note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 6,350 and 21,300 levels respectively. The market breadth on BSE was negative in the ratio of 821:1456 while 151 scrips remained unchanged.

The BSE Sensex is currently trading at 21225.62, down by 100.80 points or 0.47% after trading in a range of 21,327.75 and 21,175.08. There were 9 stocks advancing against 21stocks declining on the index.

The broader indices continued to reel under pressure; the BSE Mid cap and Small cap indexes were trading lower by 0.63% and 0.93% respectively.

The gaining sectoral indices on the BSE were IT up by 2.27%, TECK up by 1.65%, FMCG up by 0.73% and Health Care up by 0.09%. While, Power down by 4.55%, Capital Goods down by 2.95%, PSU down by 2.93%, Bankex down by 2.15% and Realty down by 1.58% were the losing indices on BSE.

The top gainers on the Sensex were TCS up by 3.74%, Wipro up by 2.33%, Infosys up by 1.44%, ITC up by 1.39%, and Hero MotoCorp up by 1.06%. On the flip side, NTPC down by 11.32%, BHEL down by 3.96%, L&T down by 3.67%, ICICI Bank down by 3.35% and ONGC down by 2.89%.

Meanwhile, giving some respite to Special Economic Zones (SEZs) struggling with global economic slowdown, the government has granted more time to some 115 SEZs developers to execute their projects during April 2012 and November 2013.  Earlier, SEZs developers had sought extension of validity period citing reasons like delay in approvals from statutory/state government bodies, adverse business climate because of global economic turmoil, delay in environmental clearance, lack of demand for space in SEZs and changed fiscal incentive regime.

The government has approved 576 such zones out of which 175 have commenced exports. Further, the exports from these zones stood at Rs 2.46 lakh crore during April- September this fiscal.  In 2012-13, it was Rs 4.76 lakh crore, which is about 30 per cent of the country's total exports. Among the total 175 SEZs operation in the country, a maximum of 40 are present in Andhra Pradesh followed by Tamil Nadu having 34, 22 in Karnatka and 20 in Maharashtra.

Over the past two years, investments in SEZs have reduced owing to the imposition of taxes and the requirements of certain clearances, denting the attractiveness of these units. Meanwhile, the government has started taking measure to ease SEZs norms, which will be helpful to enhance country’s industrial development and increase exports. In an attempt to revive investors’ interest in the zones, Commerce Ministry has recently slashed the minimum area requirement for setting up SEZs.

The CNX Nifty is currently trading at 6,320.85, down by 43.05 points or 0.68% after trading in a range of 6,362.25 and 6,307.55. There were 15 stocks advancing against 35 declining on the index.

The top gainers of the Nifty were TCS up by 3.67%, Wipro up by 2.41%, Lupin up by 1.71%, Infosys up by 1.33% and ITC up by 1.28%. On the flip side, NTPC down by 11.40%, BHEL down by 4.08%, L&T down by 3.76%, JP Associates down by 3.69% and Axis Bank down by 3.64% were the major losers on the index.

The Asian equity indices were trading mostly in red; Seoul Composite down by 0.35%, Hang Seng down by 0.28%, Straits Times down by 0.91%, Shanghai Composite down by 0.03%, Nikkei 225 down by 0.25% and Taiwan Weighted down by 0.01% while, Jakarta Composite up by 1.33% and KLSE Composite up by 0.13%. 

The European markets were trading on a mixed note; France’s CAC 40 was up 0.01%, Germany’s DAX lost 0.02% and UK’s FTSE 100 dropped 0.06%.