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Local equities continue lackluster trade; Sensex below 39,400 mark
Jun-21-2019

Local equity benchmarks continued their lackluster trade in morning session, with losses of around half a percent, owing to selling pressure in frontline blue-chip counters and tailing soft global cues. Traders remain concerned the Reserve Bank of India’s (RBI) report that both bank credit and deposits slowed to 9.92 percent and 12.31 percent at Rs 96.52 lakh crore and Rs 125.40 lakh crore, respectively, for the fortnight ending June 7.  Investors also remained jittery with RBI governor Shaktikanta Das’ statement that there are clear evidences of economic activity losing traction, as the GDP growth in Q4FY19 slowed down to 5.8%. Market participants took note of SBI’s report that the Centre and state governments need to pursue labour law reforms as these are necessary for improving investment and generating employment. However, losses remain capped with a report that Bond yields on June 20, 2019 fell to their lowest level in the past 20 months as the US Federal Reserve turned dovish and kept doors open for a rate cut as early as next month. Besides, the Federation of Automobile Dealers Associations (FADA) has written to the GST Council, asking that the interest charged on automobile dealers in case of late GST payment, should be calculated on net tax liability instead of gross liability.

On the global front, Asian markets were trading mostly in red, as anxiety over Sino-US trade negotiations clouded investor sentiment in the region. Back home, a report stated that Retail and fast moving consumer goods and durables (FMCG&D) sector together is likely to add 2.76 lakh new jobs in the first six months of the current financial year following the entry of foreign retail giants.

The BSE Sensex is currently trading at 39387.87, down by 213.76 points or 0.54% after trading in a range of 39377.00 and 39617.95. There were 9 stocks advancing against 22 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index slipped 0.29%, while Small cap index was up by 0.11%.

The gaining sectoral indices on the BSE were Basic Materials up by 0.36%, Consumer Durables up by 0.29%, Metal up by 0.23%, Power up by 0.04% and PSU was up by 0.04%, while Telecom down by 0.76%, Energy down by 0.69%, Realty down by 0.67%, Healthcare down by 0.57% and Auto was down by 0.55% were the losing indices on BSE.

The top gainers on the Sensex were Hero MotoCorp up by 1.14%, Coal India up by 1.00%, Vedanta up by 0.61%, IndusInd Bank up by 0.52% and SBI was up by 0.48%. On the flip side, Tata Motors - DVR down by 2.27%, Tata Motors down by 1.73%, Sun Pharma down by 1.69%, Maruti Suzuki down by 1.68% and Yes Bank was down by 1.57% were the top losers.

Meanwhile, in order to enable transparent and fair pricing for retail users, such as individuals and micro, small and medium enterprises, the Reserve Bank of India (RBI) said foreign exchange trading platform (FX-Retail) for retail participants is ready for rollout by the Clearing Corporation of India (CCIL) on August 05. As a further facility for retail clients, the RBI said no transaction charges will be levied by the CCIL on transactions of customers if the transactions do not exceed $50,000 per day.

The FX-Retail platform can be accessed by any customer of a bank (through the website https:// www. fxretail.co.in) who has a need to purchase or sell US Dollar against the Rupee for delivery on cash basis (same day), tom basis (next day) or spot basis (two days after date of transaction). Also, there is no cap on the number of transactions per customer during a day.

Though, the total amount of transactions of a customer will be subject to the limit assigned by its bank. The size of a single transaction is not allowed to exceed $5 million. A transaction charge of 0.0004 per cent shall be charged by the CCIL for transactions in excess of $50,000 per day.

The CNX Nifty is currently trading at 11776.00, down by 55.75 points or 0.47% after trading in a range of 11768.85 and 11827.95. There were 14 stocks advancing against 35 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were UPL up by 4.41%, Hindalco up by 1.52%, Vedanta up by 0.84%, Tech Mahindra up by 0.74% and Coal India up by 0.63%. On the flip side, Yes Bank down by 2.01%, Sun Pharma down by 1.84%, Tata Motors down by 1.60%, Maruti Suzuki down by 1.52% and Indian Oil Corp. down by 1.50% were the top losers.

On the global front, Asian markets are trading mostly in red; Nikkei 225 slipped 206.76 points or 0.96% to 21,256.10, Hang Seng decreased 125.77 points or 0.44% to 28,424.66, Jakarta Composite lost 45.24 points or 0.71% to 6,290.46, KOSPI fell 8.93 points or 0.42% to 2,122.36, Straits Times was down by 2.12 points or 0.06% to 3,312.39.

On the other side, Taiwan Weighted strengthened 2.79 points or 0.03% to 10,787.80 and Shanghai Composite was up by 17.90 points or 0.6% to 3,005.02.
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