Weak trade prevails; Nifty below 6300 mark

Indian equities continued weak trade in the late afternoon session on account of selling in frontline counters and taking cues from Asian counterparts. Traders were seen piling positions in Oil & Gas, FMCG and Auto stocks while selling was witnessed in IT, TECK and Realty sector stocks. Hectic activity was witnessed in banking stocks after the industry body Assocham underscored 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. In scrip specific development, Indian Oil Corporation (IOC) was trading firm after an Empowered Group of Ministers (EGoM) approved selling 10% of government stake in IOC to ONGC and OIL India to rake in Rs 4,800-5,000 crore. On the global front, the Asian markets were trading mostly in red, while the European markets were trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 6,300 and 21,200 levels respectively. The market breadth on BSE was negative in the ratio of 810:1627 while 152 scrips remained unchanged.

The BSE Sensex is currently trading at 21123.76, down by 141.42 points or 0.67% after trading in a range of 21,270.11 and 21106.91. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices too were down and out in red; the BSE Mid cap and Small cap indices were trading lower by 0.93% and 1.05% respectively.

The gaining sectoral indices on the BSE were Oil and Gas up by 0.93%, FMCG up by 0.26% and Auto up by 0.16%. While, IT down by 2.23%, TECK down by 2.04%, Realty down by 1.59%, Bankex down by 1.13% and Metal down by 0.69% were the top losing indices on BSE.  

The top gainers on the Sensex were Hindustan Unilever up by 1.69%, Bajaj Auto up by 1.60%, Tata Power up by 1.15%, Reliance Industries up by 1.07% and Hero MotoCorp up by 0.78%. On the flip side, TCS down by 5.25%, Wipro down by 3.37%, HDFC down by 2.19%, Bharti Airtel down by 2.08% and Axis Bank down by 1.83%.

Meanwhile, concerned over acute liquidity crunch faced by the Indian fertiliser sector, The Fertiliser Ministry has sought an additional subsidy of Rs 20,000 crore. Non-allocation of subsidy fund to fertilizer industry on time has left it with no money to pay subsidy bills for the third and fourth quarters in the current financial year.

So far this fiscal, the government has allocated Rs 70,586 crore funds to Department of Fertiliser (DoF) as against the total demand of Rs 1,05,497 crore for the 2013-14 fiscal. Commodity wise, a subsidy of Rs 41,158.85 crore was allocated for urea and Rs 29,426.88 crore for P&K fertilisers. The DoF has been able to pay subsidy dues till May to fertiliser firms manufacturing urea locally, while for non-urea fertilizers, it can pay subsidy only till this month.

Meanwhile, in order to help fertiliser companies tide over the cash crunch, The Finance Ministry has approved a special banking arrangement of Rs 9,000 crore. Earlier in September, the Finance ministry had agreed to pay only Rs 5,500 crore subsidy under a special banking arrangement (SBA) as against Rs 12,000 crore sought by the Department of Fertilisers (DoF).

Backlog of Rs 32,000 crore for the year 2012-13 has to be paid from this year's allocations. The government has agreed to bear interest of 8 per cent per annum with 2.7 per cent interest to be borne by the industry. For this repayment, Finance Ministry provided a cash outgo of Rs 2,000 crore as additional subsidy in the second supplementary demand for grants approved in December. 

The CNX Nifty is currently trading at 6,282.15 down by 36.75 points or 0.58% after trading in a range of 6,327.10 and 6,275.55. There were 19 stocks advancing against 31 declining on the index.

The top gainers of the Nifty were BPCL up by 3.25%, Hindustan Unilever up by 1.60%, Bajaj Auto was up by 1.53%, Tata Power up 1.22% and Ambuja Cement up by 0.97%. On the flip side, TCS down by 5.11%, Wipro down by 3.66%, Ranbaxy down by 3.04%, DLF down by 2.93%, and Bharti Airtel down by 2.17% were the top losers.

The Asian equity indices were trading mostly in red; Kospi Composite down by 0.66%, Taiwan Weighted down by 0.19%, Shanghai Composite down by 0.93% and Nikkei 225 down by 0.08%. While, Straits Times up by 0.06%, Hang Seng up by 0.61% and Jakarta Composite up by 0.11% were the only gainers.

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

The European markets were trading in green; France’s CAC 40 was up 0.16%, Germany’s DAX added 0.21% and UK’s FTSE 100 gained 0.03%.