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Local equities slip into red zone; Nifty below 11,050 mark
Aug-20-2019

Local benchmarks erased all the gains to turn red in morning session, both Sensex and Nifty were trading below their crucial 37,400 and 11,050 marks, respectively. Traders turned cautious with former Reserve Bank of India (RBI) Governor Raghuram Rajan calling slowdown in the economy very worrisome and said the government needs to fix the immediate problems in power and non-bank financial sectors and come out with a new set of reforms to energise private sector to invest. However, losses remain capped with Finance Minister Nirmala Sitharaman’s statement that corporate tax rate for companies with over Rs 400 crore turnover will be gradually cut to 25% and the government will support wealth creators. Some support came in with RBI governor Shaktikanta Das’ statement the central bank is looking to formalise policies to link loan rates to an external benchmark like the repo so as to speed up transmission. Besides, a report stated that a top American lawmaker has urged the Trump Administration to resolve the trade tension with India as soon as possible.

On the global front, Asian markets were trading mostly in green, as China took the next step in money management reform, and US gave the Chinese tech company Huawei a slight reprieve in Washington's ongoing trade war with Beijing. Back home, the governments’ data showed that India’s food grains production is almost flat at 284.95 million tonnes (MT) in 2018-19 crop year due to fall in pulses and coarse cereals output even as the country harvested record rice as well as wheat crops.

The BSE Sensex is currently trading at 37319.87, down by 82.62 points or 0.22% after trading in a range of 37241.83 and 37511.55. There were 14 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index slipped 0.49%, while Small cap index was down by 0.48%.

The few gaining sectoral indices on the BSE were IT up by 1.64%, TECK up by 1.40%, Auto up by 0.51% and Utilities was up by 0.08%, while Basic Materials down by 1.06%, BANKEX down by 1.02%, Metal down by 1.02%, Energy down by 0.97% and FMCG was down by 0.89% were the top losing indices on BSE.

The top gainers on the Sensex were Infosys up by 2.43%, TCS up by 1.40%, Maruti Suzuki up by 1.21%, Hero MotoCorp up by 1.01% and Bajaj Auto was up by 0.95%. On the flip side, Yes Bank down by 5.48%, IndusInd Bank down by 2.83%, ITC down by 2.29%, Bajaj Finance down by 2.03% and ICICI Bank was down by 1.69% were the top losers.

Meanwhile, automobile dealers' body -- Federation of Automobile Dealers Associations (FADA) has said that retail sales of passenger vehicles (PVs) dropped by 11% to 2,43,183 units in July 2019 as compared to 2,74,772 units the same period last year.  The drop in PV sales was mainly on account of weak demand across the country.

Two-wheeler sales declined by 5% to 13,32,384 units last month as compared to 14,03,382 units in the year-ago period. Commercial vehicle sales dropped by 14% to 23,118 units against 26,815 units in July last year. However, three-wheeler sales saw an increase of 3% to 55,850 units last month from 54,250 units in the same period a year ago.

Total sales across categories declined by 6% to 16,54,535 units in July as against 17,59,219 units. FADA President Ashish Kale said consumer sentiment and overall demand continued to be quite weak across all segments and most geographies. FADA represents over 15,000 automobile dealers who run around 25,000 dealerships across the country.

The CNX Nifty is currently trading at 11019.30, down by 34.60 points or 0.31% after trading in a range of 10994.40 and 11076.30. There were 20 stocks advancing against 30 stocks declining on the index.

The top gainers on Nifty were Wipro up by 2.70%, Infosys up by 2.35%, TCS up by 1.34%, Maruti Suzuki up by 1.33% and Hero MotoCorp was up by 1.04%. On the flip side, Yes Bank down by 5.35%, Indiabulls Housing Finance down by 4.96%, IndusInd Bank down by 2.86%, Ultratech Cement down by 2.30% and ITC was down by 2.21% were the top losers.

Asian markets were trading mostly in green, Hang Seng increased 28.77 points or 0.11% to 26,320.61, Nikkei 225 surged 96.42 points or 0.47% to 20,659.58, Taiwan Weighted strengthened 37.84 points or 0.36% to 10,526.59, Shanghai Composite gained 2.07 points or 0.07% to 2,885.17, Straits Times advanced 11.50 points or 0.37% to 3,139.95 and KOSPI was up by 20.28 points or 1.05% to 1,960.18. On the other hand, Jakarta Composite was down by 3.73 points or 0.06% to 6,292.99.
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