Benchmarks extend losses; trade at intra-day low level

Indian equity benchmarks extended early losses and reached at intra-day low level in afternoon session amid selling witnessed in IT, teck and banking stocks. Investors’ sentiments were dented as global rating agency, Moody's has stated that India's economic recovery is likely to be slow in the second half of 2014. Further, weak global cues also added to the pessimistic sentiments. On sector specific movements, selling was witnessed in banking stocks after the industry body Assocham has said that the growth of Indian banking industry is likely to remain under pressure with gross non-performing assets (NPAs) expected to touch 5 percent of total loans by March this year. IT index was trading in red on BSE as IT major TCS result for Q3FY14 has slightly missed the street’s estimation. On stock specific movement,   Tata Power,  Bajaj Auto and Hidustan Unilever were trading up by over 1.40%, while, TCS, Wipro and HDFC were trading down by over 2.20% on BSE. Barring all IT stocks, Infosys was trading up by around 0.70% to Rs 3750 as company had improved its revenue guidance for the financial year from 9-10% to 11.5-12%.

On global front, Asian shares were trading in red with Seoul Composite down by 0.66% and Taiwan Weighted down by 0.19%. Back home, the NSE Nifty and BSE Sensex were trading up their psychological 6,300 and 21,000 levels respectively. The market breadth on BSE was negative, out of 2,247 stocks traded, 920 stocks advanced, while 1,202 stocks declined on the BSE.

The BSE Sensex is currently trading at 21,188.63 down by 76.55 points or 0.36% after trading in a range of 21,270.11 and 21,160.66. There were17 stocks advancing against only 13 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.32%, while Small cap index up by 0.17%.

The gaining sectoral indices on the BSE were Oil and Gas up by 0.84%, Auto up by 0.77%, FMCG up by 0.41%, Realty up by 0.40% and Healthcare up by 0.30%. While, IT down by 1.84%, Teck down by 1.48%, Bankex down by 0.72%, Capital Goods down by 0.12% and Power down by 0.02% were the losing indices on BSE.  

The top gainers on the Sensex were Tata Power up by 1.54%, Bajaj Auto up by 1.47%, Hidustan Unilever up by 1.40%, M&M up by 1.07% and Sun Pharma up by 1.07%. On the flip side, TCS down by 4.78%, Wipro down by 3.06%, HDFC down by 2.28%, Axis Bank down by 1.51% and HDFC Bank down by 0.83%.

Meanwhile, amid rising concerns over the deteriorating macro-economic indicators of the country, global rating agency, Moody's has stated that India's economic recovery is likely to be slow in the second half of 2014 and the outcome of general elections could affect the growth prospect. Moody’s has assigned 'Baa3' rating on India with a stable outlook indicating medium grade with moderate credit risk.

Further, the rating agency has projected that India's inflation and interest rates to decline during the year. Referring to country’s fiscal position, Moody’s highlighted that fiscal deficit would remain higher in future with social welfare measures such as the Food Security Act passed last year that will raise the government's medium-term expenditure commitment. Meanwhile, the rating agency added that the structure of India's government debt compromises domestic currency, relatively low real rates and have long tenors, which has mitigated stress on the government's fiscal position.  On the other hand, the government hopes to contain fiscal deficit at 4.8 percent of GDP in FY14 and reduce it further to 3 per cent by FY17.

Global rating agency also highlighted that its expectation for global growth prospects will improve with declining global risks and sovereign ratings in South and Southeast Asia will remain largely stable in 2014.

The CNX Nifty is currently trading at 6,301.05 down by 17.85 points or 0.28% after trading in a range of 6,327.10 and 6,294.50. There were 29 stocks advancing against 21 declining on the index.

The top gainers of the Nifty were BPCL up by 2.78%, Ambuja Cement up by 1.77%, Tata Power up by 1.60%, Hindustan Unilever up by 1.52% and Jindal Steel up by 1.46%. On the flip side, TCS down by 4.88%, Wipro down by 3.37%, HDFC down by 2.16%, Ranbaxy down by 1.91% and Axis Bank down by 1.34% were the major losers on the index.

The Asian equity indices were trading in red; Seoul Composite down by 0.66%, Taiwan Weighted down by 0.19%, Shanghai Composite down by 1.01%, KLSE Composite down by 0.60%, Jakarta Composite down by 0.02%, Nikkei 225 down by 0.08% and Straits Times down by 0.04%. While, Hang Seng up by 0.82%.