Benchmarks pare initial gains in late morning

Indian equity benchmarks have pared morning gains and slipped into negative territory on emergence of profit-booking by retail investors tracking weak cues in other Asian markets. However, losses on down-side remained capped as sentiments got some support after Finance Minister P Chidambaram emphasized that the economy is presently more stable as the fiscal and current account deficits are under control and the economy is more stable than it was 18 months ago. Back home, traders were buying, Capital Goods, Realty and Bankex stocks, while selling was seen in Healthcare, IT and Metal. Telecom stocks too remained on buyers’ radar after Planning Commission deputy chairman Montek Singh Ahluwalia said that operationalisation of the model code of conduct would delay spectrum sharing and trading by three to four months, though the government had in principle approved the concept.

The market breadth on BSE remains positive with advances to declines in the ratio of 1152:857. BSE Sensex and NSE Nifty were comfortably trading near their psychological 21,800 and 6,500 levels respectively.

The BSE Sensex is currently trading at 21869.60 down by 50.19 points or 0.23% after trading in a range of 22005.54 and 21805.22. There were 12 stocks advancing against 18 declines on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.18% and Small cap index gained 0.41%.

The top gaining sectoral indices on the BSE were, Capital Goods up by 1.64%, Realty up by 0.73%, Bankex up by 0.71%, Power up by 0.55% and Oil and Gas up by 0.55%, while Healthcare down by 1.49%, IT down by 1.37%, Metal down by 1.10%, TECK down by 0.78% and FMCG down by 0.63% were the top losers on the sectoral index.

The top gainers on the Sensex were BHEL up by 2.80%, L&T up by 1.96%, RIL up by 1.93%, Bharti Airtel up by 1.84% and Mahindra & Mahindra up by 1.41%. On the flip side, Sun Pharma was down by 2.68%, Hindalco was down by 2.17%, Tata Motors was down by 1.97%, Gail India was down by 1.64% and TCS was down by 1.64% were the top losers on the Sensex.

Meanwhile, concerned over the slow growth in Indian exports, the Federation of Indian Export Organisations (FIEO) has emphasized that the government must expeditiously clear Rs 19,000 crore of duty refund claims as the mounting arrears is impacting the country’s overseas shipments. Highlighting liquidity as a big issue to domestic exports, FIEO President Rafeeque Ahmed asserted that despite repeated requests, the customs authorities have failed to clear the claims since October last year. Pending claims has now reached about Rs 19,000 crore and would reach at Rs 25,000 crore by end of the fiscal.

FIFO President added that pending claims are highest at JawaharLal Nehru sea port at Rs 3,059 crore followed by Chennai sea port with Rs 1,280 crore. Further, VAT claims in states like Maharashtra, West Bengal, Punjab and Tamil Nadu and are very high. Small and medium exporters would be the worst-hit due to delay in duty refund claims, he added.

The FIFO had already notified that India’s exports will fall short by about $10 billion from its set target of $325 billion for the current fiscal as the factors like declining manufacturing growth, pending duty refund claims and slow recovery in global demand are adversely impacting the country’s exports. However, the value of exports increased by 5.71% to $257.09 billion during April-January’FY14 as against $243.19 billion in the same period of previous fiscal year. FIEO is presently preparing a draft for the new Foreign Trade Policy for 2014-19 including measures to boost exports, which will be submitted to the new government in the next two and a half months time.

The CNX Nifty is currently trading at 6,515.50 down by 11.15 points or 0.17% after trading in a range of 6,548.75 and 6,487.35. There were 24 stocks advancing against 26 decliners on the index.

The top gainers of the Nifty were IDFC up by 3.24%, BHEL up by 2.49%, IndusInd Bank up by 2.05%, L&T up by 1.84% and RIL up by 1.83%. On the flip side, Ranbaxy down by 3.40%, Sun Pharma down by 2.59%, Hindalco down by 2.13%, Tata Motors down by 2.03% and TCS down by 1.97% were the top losers on the index.

All Asian equity indices were trading in red; Shanghai Composite declined 38.06 points or 1.85% to 2,019.84, Hang Seng decreased by 365.62 points or 1.61% to 22,294.87, KLSE Composite contracted 8.92 points or 0.49% to 1,823.34, Nikkei 225 crumbled by 157.53 points or 1.03% to 15,116.61, Straits Times dropped 14.10 points or 0.45% to 3,122.16, KOSPI Composite slipped by 21.74 points or 1.06% to 1,953.78, Taiwan Weighted was down by 48.27 points or 0.55% to 8,665.69 and Jakarta Composite was  down by 3.29 points or 0.07% to 4,682.60.