Infosys’ Q3 numbers fail to cheer markets; Benchmarks trade flat

Indian equity benchmarks are trading near their neutral lines as investors remained on sidelines ahead of the November index of industrial production data to be released later today. Moreover, Infosys’ third quarter earnings, despite beating street’s expectation for the third consecutive quarter, failed to cheer markets. The IT bellwether, on the consolidated basis, registered a growth of 21.36% in net profit at Rs 2875 crore as compared to Rs 2369 crore in the same quarter previous year. Total income of the company rose 25.90% to Rs 13757 crore for quarter under review as against Rs 10927 crore in corresponding quarter previous year.

On the global front, the US markets ended mostly flat overnight ahead of the release of the closely watched monthly jobs report as traders seemed reluctant to make any significant moves. Moreover, Asian equity benchmarks were exhibiting mixed trend at this point of time as release of Chinese trade data that indicates slowing growth momentum in the world’s second-largest economy weighed on investors’ sentiments.

Back home, on the sectoral front, software witnessed the maximum gain in trade followed by technology and capital goods, while metal, banking and power remained the top losers on the BSE sectoral space. The broader indices too were trading in-line with benchmarks, while the market breadth on the BSE was negative; there were 532 shares on the gaining side against 635 shares on the losing side while 61 shares remain unchanged.

The BSE Sensex opened at 20760.72; about 47 points higher compared to its previous closing of 20713.37, and touched a high and a low of 20781.05 and 20625.17 respectively. The index is currently trading at 20724.19, up by 10.82 points or 0.05%. There were 10 stocks advancing against 20 declines on the index.

The overall market breadth has made a weak start with 45.18% stocks advancing against 50.36% declines. The broader indices too were trading in green; the BSE Mid cap index up was by 0.07% and Small cap gained 0.04%. 

The top gaining sectoral indices on the BSE were, IT up by 1.51%, Teck up by 1.25%, Capital Goods up by 0.38%, Healthcare up by 0.34% and Oil & Gas up by 0.29%, while Metal down by 0.95%, Auto down by 0.83%, Bankex down by 0.72%, PSU down by 0.58% and Power down by 0.55% were the top losers on the sectoral index.

The top gainers on the Sensex were Infosys up by 2.94%, Sun Pharma up by 1.19%, Wipro up by 1.06%, RIL up by 0.99% and TCS up by 0.76%. On the flip side, Mahindra & Mahindra was down by 2.52%, SSLT was down by 2.17%, ICICI Bank was down by 1.55%, Bajaj Auto was down by 1.52% and Coal India was down by 1.40% were the top losers on the Sensex.

Meanwhile, the Cabinet Committee on Economic Affairs (CCEA) is expected to consider Food Ministry's proposal soon of increasing import duty on refined edible oil to 10 percent from the current 7.5 percent in order to discourage cheaper inflows of refined oils from overseas for protecting domestic refiners and farmers. Last year, Food Ministry's proposal was rejected by the CCEA amid fears of its impact on elevated inflation.

Meanwhile, the negative inflation in edible oils for a fifth straight month in November as compared with a 6.9% headline inflation during the same period, has encouraged the government for a duty hike in edible oil. On the other hand, the agriculture ministry feels the duty structure on edible oils should be such that it maintains domestic prices in accordance with the movement of prices globally.

India imports more than a half of its annual edible oil requirements. Despite, the world's largest edible oil buyer, India impose low import duties. However, major exporters such as Indonesia and Malaysia offer duty incentives on supplies of refined edible oils to promote their local refiners. In November, Indian refined oil imports shot up by 172% in a year to 2,08,076 tonnes, while crude oil purchases from overseas were up by only 20% at 719,035 tonnes.

The CNX Nifty opened at 6,178.85; about 10 points higher as compared to its previous closing of 6,168.35, and has touched a high and a low of 6,185.90 and 6,139.60 respectively. The index is currently trading at 6,168.90, up by 0.55 points or 0.01%. There were 21 stocks advancing against 29 declines on the index.

The top gainers of the Nifty were Infosys up by 3.04%, IndusInd Bank up by 1.32%, Sun Pharmaceuticals up by 1.07%, JP Associate up by 1.02% and Asian Paint up by 0.93%. On the flip side, SSLT down by 2.47%, M&M down by 2.36%, Power Grid down by 1.92%, ICICI Bank down by 1.82% and UltraTech Cement down by 1.76% were the top losers on the index.

Most of the Asian equity indices were trading in green; Hang Seng rose 72.04 points or 0.32% to 22,859.37, Jakarta Composite surged 20.63 points or 0.49% to 4,221.85, Nikkei 225 increased 8.92 points or 0.06% to 15,889.25, Straits Times added 3.59 points or 0.11% to 3,149.00 and Taiwan Weighted was up by 21.53 points or 0.25% to 8,536.21.

On the flip side, Shanghai Composite declined 10.01 points or 0.49% to 2,017.61, KLSE Composite decreased 1.66 points or 0.09% to 1,826.55 and Seoul Composite was down by 11.67 points or 0.60% to 1,934.44.