Benchmarks remain under pressure in late morning trade

Benchmark equity indices continue to remain under pressure in late morning trade on the back of negative cue from global peers. Investor’s sentiments remained dampened as the rupee depreciated against the US dollar in early trade due to increased demand for the American currency from importers.  However, the losses on down-side remained capped on report that the foreign institutional investors bought shares worth Rs 468.47 crore on Wednesday as per the provisional data from the National Stock Exchange.

On the global front, Most of the Asian markets are trading in red due to renewed worries about the global economy after a contraction in Chinese manufacturing sector activity, as well as on a report from the International Monetary Fund that the global economic recovery is still weak. The Japanese market tumbled, with investors pressing sales at several counters following the release of weak trade data and as the yen gained. Japan's merchandise trade deficit stood at 2,789.97 billion yen in January, missing forecasts for a shortfall of 2,487 billion yen following the downwardly revised deficit of 1,304.2 billion yen in December

Back home, traders were buying, Consumer Durables, Auto and Healthcare stocks, while selling was seen in Bankex, Metal and PSU. Telecom stocks were trading under pressure as the guidelines for mergers and acquisitions of telecom companies are expected to be in place within 10 days which may disappoint phone companies because the government has refused to concede the demand that they shouldn't be required to pay market-linked prices for spectrum that comes with any acquisition.

The market breadth on BSE remains negative with advances to declines in the ratio of 853:888. BSE Sensex and NSE Nifty were comfortably trading near their psychological 20,600 and 6,100 levels respectively.

The BSE Sensex is currently trading at 20653.56 down by 69.41 points or 0.33% after trading in a range of 20661.07 and 20589.03. There were 8 stocks advancing against 22 declines on the index. The broader indices were trading green; the BSE Mid cap index was up by 0.09% and Small cap index gained 0.07%.

The top gaining sectoral indices on the BSE were, Consumer Durables up by 0.56%, Auto up by 0.33% and Healthcare up by 0.25%, while Bankex down by 1.17%, Metal down by 0.68%, PSU down by 0.68%, Power down by 0.36% and Oil & Gas down by 0.21% were the top losers on the sectoral index. 

The top gainers on the Sensex were Bajaj Auto up by 1.95%, TCS up by 0.80%, Dr Reddys Lab up by 0.76%, Tata Motors up by 0.60% and Cipla up by 0.46%. On the flip side, Tata Steel was down by 2.37%, ICICI Bank was down by 1.46%, SBI was down by 1.44% , Tata Power was down by 1.42%, and  Axis Bank was down by 0.92% were the top losers on the Sensex.

Meanwhile, after the CNG prices were cut earlier this month, Oil Minister M Veerappa Moily has ordered city gas distribution (CGD) firms to display break-up of fuel price to consumers, which would include cost of gas to the CGD entity, supply and distribution cost, company's margin, excise, VAT and any other tax - to their customers.

This move which would ensure the benefit of cheaper domestic gas passed onto the end users and would also lead to transparency in pricing.  The Oil Minister has also asked all CGD companies to furnish the break-up of CNG and PNG price to the Ministry on annual basis by April 30 each year, which includes the data for 2013-14 to be furnished by April 30, 2014, non-compliance to which lead to cancellation of domestic gas allocation for CNG and PNG.

Compressed natural gas or (CNG) sold to automobiles and natural gas piped to household kitchens, will be the first fuel where consumer will get invoices providing break-up of price. Notably up-till now, no break-up of price of petrol, diesel, LPG or kerosene has ever been provided to consumers.

Earlier in February, the oil ministry decided to give city gas distribution (CGD) companies’ cheaper domestic gas to meet all their requirements for CNG and piped natural gas (PNG) supplies to households compared with the previous limit of 80% for most states. This development led to a steep Rs 14.90 per kg cut in price of compressed natural gas or CNG and Rs 5 per kg reduction in rates of cooking gas piped into kitchens in Delhi. Similar cuts in rates were expected in all states, except Maharashtra and Haryana, as city gas distributors stop buying higher-priced LNG and shifted entirely to domestic gas.

The CNX Nifty is currently trading at 6,124.55 down by 28.20 points or 0.46% after trading in a range of 6,129.10 and 6,105.50. There were 11 stocks advancing against 38 decliners while 1 stock remained unchanged on the index.

The top gainers of the Nifty were Bajaj-Auto up by 2.30%, Dr Reddy up by 2.30%, TCS up by 0.81%, Tata Motors up by 0.64% and Sun Pharma up by 0.46%. On the flip side, Bank of Baroda down by 2.18%, Tata Steel down by 2.11%, IDFC down by 1.75%, Indusind Bank down by 1.67% and Kotak Bank down by 1.55% were the major losers on the index.

Most of the Asian equity indices were trading in red; Hang Seng tumbled 241.92 points or 1.07% to 22,422.60, Jakarta Composite decreased 11.31 points or 0.25% to 4,581.34, KLSE Composite declined by 3.18 points or 0.17% to 1,826.27, Nikkei 225 crumbled 283.35 points or 1.92% to 14,483.18, Straits Times slipped by 2.50 points or 0.08% to 3,086.2, Seoul Composite dropped 10.72 points or 0.55% to 1,932.21 and Taiwan Weighted was down by 37.29 points or 0.43% to 8,539.72.

On the flip side, Shanghai Composite was up by 14.28 points or 0.67% to 2,156.83.