Benchmarks continue to trade weak amid weak global cues

Indian equity benchmarks continued to trade deeply in red in afternoon session amid selling witnessed in IT stocks after weaker-than-expected the US manufacturing data, which expanded at its slowest pace in eight months to 51.3 in January as compared to 56.5 December on account of sluggish new order growth. Investors also remained cautious as the global rating agency Fitch has raised concerns over the country’s fiscal deficit number and rising bank NPA levels. IT Index was top loser on BSE down by 2.44% followed by Teck and Metal indices both down by over 1%. On stock specific movement, SBI, Cipla and Tata Motors were trading up by over 0.70%, while, Wipro, M&M and Gail India were trading down by over 2.80% on BSE. Shares of Hero MotoCorp were up over 1% at Rs 1,985 as the company reported yet another month with sales of over 5.5 lakh units in January despite challenging market conditions. Among other stocks, Jaiprakash Power Ventures has slipped more than 5% after the company reported a net loss of Rs 153.05 crore in Q3FY14.

On global front, Asian equity indices were trading lower with Seoul Composite down by 1.52%, and Shanghai Composite down by 0.82% as slowed down in the US manufacturing activity sharply raised risk aversion. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 6,000 and 20,500 levels respectively. The market breadth on BSE was positive, out of 2,097 stocks traded, 750 stocks advanced, while 1,224 stocks declined on the BSE.

The BSE Sensex is currently trading at 20,032.39 down by 176.87 points or 0.88% after trading in a range of 20,093.67 and 19,963.12. There were only 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.39%, while Small cap index down by 0.59%.

The gaining sectoral indices on the BSE were Consumer Durables up by 0.20%. While, IT down by 2.44%, Teck down by 1.93%, Metal down by 1.05%, Realty down by 0.87% and Oil and Gas down by 0.83% were the losing indices on BSE.   

The top gainers on the Sensex were SBI up by 1.52%, Cipla up by 0.84%, Tata Motors up by 0.74%, Bharti Airtel up by 0.74% and Bajaj Auto up by 0.26%. On the flip side, Wipro down by 3.22%, M&M down by 3.12%, Gail India down by 2.88%, TCS down by 2.62% and Hindalco Inds down by 2.46%.

Meanwhile, ahead of the Lok Sabha polls, the government has planned to shell out Rs 1,400 crore to provide subsidised loans to women self-help groups (SHGs) in rural India. As per the proposal, 3 percent interest subvention given to women will be effective on loans of up to Rs 3 lakh taken after April 1, 2013. The move is likely to benefit 3 crore women in 25 lakh self-help groups across the country.

During the first phase of government’s plan, Ministry of Rural Development will provide loans to women self-help groups in the 150 identified naxal-affected districts at rate of 7 percent as against over 10 percent market rate, making it equal to the crop loans to farmers. The rates for SHGs, who repay the loan on time, would be further lowered to 4 per cent. Further, the move will cost Rs 650 crore to the government, which will be funded from the Rs 2,600-crore budgetary allocation to the ministry under the National Rural Livelihood Mission (NRLM). Meanwhile, in the remaining districts across the country, the women self-help groups would be compensated through rebate which will cost the ministry another Rs 750 crore, making the total cost to government as subsidised loans at Rs 1,400 crore.

For the next five years, the government has planned to provide subsidised loans to all 640 districts and to raise the number of SHGs to 60 lakh enrolling 7 crore women as compared to present 3 crore. During 2012-13, banks had given Rs 21,000 crore as loans to SHGs and 85 percent of bank loans given to SHGs were in four southern states - Tamil Nadu, Karnataka Andhra Pradesh, and Kerala. 

The CNX Nifty is currently trading at 5,952.85 down by 48.95 points or 0.82% after trading in a range of 5,971.25 and 5,933.30. There were only 15 stocks advancing against 35 declining on the index.

The top gainers of the Nifty were SBI up by 1.64%, Bank of Baroda up by 1.39%, PNB up by 1.16%, Tata Motors up by 1.10% and Cipla up by 0.80%. On the flip side, HCL Tech down by 4.40%, M&M down by 3.20%, Wipro down by 3.17%, Gail down by 3.07% and TCS down by 2.47% were the major losers on the index.

The Asian equity indices were trading in red; Seoul Composite down by 1.52%,  Nikkei 225 down by 3.76%, Hang Seng down by 2.58%, Straits Times down by 0.87%, KLSE Composite down by 1.29% and Jakarta Composite up by 0.59%.