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Indian bourses trade flat in afternoon deals
Jun-24-2019

Indian equity benchmarks were trading flat in afternoon session, after recovering from early losses amid weak cues from other Asian markets and rising crude prices. The sentiments remained in lackluster mood as the Indian monsoon has been progressing slower-than-expected, leading to a delay in planting of summer-sown crops in the country, and raising concerns over lower agricultural production. Traders also took a note of Industry body CII’s statement that states should have the power to determine minimum wages as the concept of a national minimum wage will affect job creation. However, traders took some support with Niti Aayog’s statement that expert panel for macroeconomics and employment came out with suggestions to achieve $5 trillion economy target during an interaction with Prime Minister Narendra Modi.

On the global front, Asian markets were trading mixed as tensions between the U.S. and Iran lingered after the latter shot down an American surveillance drone. Back home, the BSE Sensex is currently trading at 39198.38, up by 3.89 points or 0.01% after trading in a range of 39070.27 and 39300.02. There were 12 stocks advancing against 19 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.13%, while Small cap index was up by 0.15%.

The top gaining sectoral indices on the BSE were Industrials up by 0.31%, Capital Goods up by 0.31%, FMCG up by 0.25%, TECK up by 0.14% and IT was up by 0.13%, while Oil & Gas down by 1.58%, Energy down by 1.00%, Metal down by 0.63%, Auto down by 0.52% and Realty was down by 0.44% were the top losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 1.51%, Mahindra & Mahindra up by 1.24%, SBI up by 1.19%, Indusind Bank up by 0.98% and TCS was up by 0.84%. On the flip side, ONGC down by 2.92%, Bajaj Auto down by 1.74%, Tata Steel down by 1.71%, Vedanta down by 1.62% and Hero MotoCorp was down by 1.41% were the top losers.

Meanwhile, the Federation of Indian Chamber of Commerce and Industry (FICCI) in its quarterly survey has found that sentiment in the manufacturing sector remains subdued as the proportion of respondents reporting higher output growth during Q1 (April-June) of 2019-20 has dropped to 41 percent as against 54 percent  in January-March (Q4) of 2018-19. It noted that the percentage of respondents expecting low or static production is 59 percent in the first quarter of 2019-20, which was 46 percent in the previous quarter.

According to the survey, in terms of order book, 36 percent of the respondents during the quarter under review are expecting higher number of orders against 44 percent in the fourth quarter of the last financial year. It also noted that 86 percent of the respondents are expecting either more or same level of inventory in April-June 2019, substantially higher than 69 percent in Q1 of 2018-19. This has been largely due to subdued domestic and export demand. It also cited a moderate outlook for exports as 34 percent of the participants expect a rise in outward shipments for April-June and 27 percent estimate exports to continue to be on similar path as the same quarter last year. However, exchange rate fluctuations have not led to any significant change in exports as 79 percent of the respondents reported that the exports were not affected much by rupee fluctuation.

FICCI further stated that the recent cut in repo rate by Reserve Bank of India (RBI) should come as a relief for the industry if banks pass it on and it expects more reduction in the rates in coming months to drive investments. It noted that cost of production as a percentage of sales for manufacturers has risen for 63 percent of its respondents, which is significantly lower than 72 percent for Q4 of 2018-19. It pointed out that this is primarily due to increased cost of raw materials, wages, power cost, rising crude oil prices and increase in finance cost.

The CNX Nifty is currently trading at 11721.30, down by 2.80 points or 0.02% after trading in a range of 11687.30 and 11754.00. There were 21 stocks advancing against 28 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were UPL up by 3.69%, Yes Bank up by 1.32%, Coal India up by 1.32%, Mahindra & Mahindra up by 1.20% and SBI was up by 1.16%. On the flip side, ONGC down by 2.98%, Bajaj Auto down by 1.93%, Vedanta down by 1.89%, JSW Steel down by 1.87% and Eicher Motors was down by 1.85% were the top losers.

Asian markets were trading mixed; Shanghai Composite gained 0.76 points or 0.03% to 3,002.74, KOSPI rose 0.71 points or 0.03% to 2,126.33, Hang Seng increased 5.89 points or 0.02% to 28,479.60 and Nikkei 225 was up by 27.35 points or 0.13% to 21,285.99.

On the other hand, Straits Times trembled 15.68 points or 0.47% to 3,305.72, Jakarta Composite lost 5.88 points or 0.09% to 6,309.56 and Taiwan Weighted was down by 24.32 points or 0.23% to 10,779.45.
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