Markets trade lower on weak global cues

Pressurized by weak global cues, Indian equity benchmarks are trading slightly in the red in early morning trade. The US markets returned to the somber mood and ended mostly lower overnight on getting a mixed batch of economic data. There was stronger than expected regional manufacturing growth but an unexpected pullback in homebuilder confidence. Moreover, most of the Asian markets were trading in the red terrain at this point of time with Japanese Nikkei extending its losses from the previous session as stronger yen weighed on investor sentiment.

Back home, some cautiousness also came in as the Global ratings agency Moody’s underscored that India’s economic recovery is likely to be slow in the second half of 2014 and the outcome of general elections could have an impact on the growth prospects. Sentiments also remained dampened after TCS’ Q3 result fell short of market expectations. The company, on consolidated basis, reported 50.25% rise in its net profit at Rs 5333.43 crore for the quarter ended December 31, 2013 as compared to Rs 3549.62 crore for the same quarter in the previous year. Total income of the group has increased by 34.90% at Rs 21977.03 crore in Q3FY14 as compared to Rs 16291.12 crore in Q3FY13.

On the sectoral front, auto witnessed the maximum gain in trade followed by realty and oil and gas, while software, technology and banking remained the top losers on the BSE sectoral space. The broader indices too were struggling to get any traction, while the market breadth on the BSE was negative; there were 731 shares on the gaining side against 767 shares on the losing side while 82 shares remain unchanged.

The BSE Sensex opened at 21236.65; about 28 points lower compared to its previous closing of 21265.18, and touched a high and a low of 21270.11 and 21193.02 respectively.

The index is currently trading at 21218.28, down by 46.90 points or 0.22%. There were 22 stocks advancing against 8 declines on the index.

The overall market breadth has made a weak start with 46.27% stocks advancing against 48.54% declines. The broader indices were trading mixed; the BSE Mid cap down by 0.13% and Small cap indices trading up by 0.03%.

The top gaining sectoral indices on the BSE were, Auto up by 0.78%, Realty up by 0.73%, Oil & Gas up by 0.62%, Healthcare up by 0.59% and Consumer Durables up by 0.56%, while IT down by 1.43%, Teck down by 1.10%, Bankex down by 0.42%, Power down by 0.08% and FMCG down by 0.07% were the top losers on the sectoral index. 

The top gainers on the Sensex were Cipla up by 1.33%, Sun Pharma up by 1.10%, Maruti Suzuki up by 1.04%, Mahindra & Mahindra up by 0.95% and Coal India up by 0.92%. On the flip side, TCS was down by 3.94%, HDFC was down by 1.88%, HDFC Bank was down by 1.31%, Wipro was down by 1.30% and ICICI Bank was down by 0.37% were the top losers on the Sensex.

Meanwhile, the Director-General of Directorate General of Hydrocarbons (DGH), R.N. Choubey stated that policy to lay out the parameters for extension of production sharing contracts (PSCs) between the exploration companies and Government will be issued by the year-end. The PSC for projects such as Panna-Mukta and Tapti (PMT) fields will expire in the next few years.

At present, British Gas (BG)- ONGC-Reliance Industries joint venture is exploring oil and gas in the Panna-Mukta and Tapti (PMT) fields. The production in the region accounts for around 6.5% of the country’s domestic oil and gas production.

Meanwhile, BG- ONGC-Reliance Industries joints venture has already told to the Petroleum and Natural Gas Ministry about their intent to seek extension for the PMT fields, which expires in 2019. BG has 30% participating interest in the Joint venture, while ONGC and Reliance Industries consist 40% and 30% share. The PMT fields are under the PSC framework, which was given before the licensing rounds were introduced in the country.

In order to cut India's dependence on imports for meeting its energy needs, the Government will offer 46 oil and gas blocks under the 10th round of NELP auction under completely revamped terms. Tenth round of NELP auction will be the second highest offering of blocks since the advent of NELP in 1997, a common platform for public and private sector companies to bid for the blocks.The CNX Nifty opened at 6,306.25; about 12 points lower as compared to its previous closing of 6,318.90, and has touched a high and a low of 6,327.10 and 6,304.40 respectively. The index is currently trading at 6,307.95, down by 10.95 points or 0.17%. There were 33 stocks advancing against 16 declines and one stock unchanged on the index.

The top gainers of the Nifty were BPCL up by 2.18%, Jindal Steel up by 1.80%, Cipla up by 1.49%, Ambuja Cements up by 1.36% and Sun Pharmaceuticals up by 1.19%. On the flip side, TCS down by 3.99%, HDFC down by 1.62%, Wipro down by 1.51%, HDFC Bank down by 1.28% and HCL Tech down by 1.28% were the top losers on the index.

Most of the Asian equity indices were trading in red; Shanghai Composite declined 11.37 points or 0.56% to 2,012.33, Jakarta Composite slipped 1.94 points or 0.04% to 4,410.54, Nikkei 225 shed 13.78 points or 0.09% to 15,733.42, Straits Times dipped 1.00 points or 0.03% to 3,139.44, Seoul Composite decreased 5.23 points or 0.27% to 1,952.09 and Taiwan Weighted was down by 14.37 points or 0.17% to 8,597.74.

On the flip side, Hang Seng was up by 193.41 points or 0.84% to 23,179.82.

The Malaysian market remained shut for the trade today on Friday in observance of Thaipusam.