Indian equity markets continue to float across the sea of red, but with trimmed losses, as investor's cherry picked select blue chip stocks available at attractive price. Much of the support is also rendered from the stocks belonging from the defensive Fast Moving Consumer Goods, Technology and Information Technology counters. However, the overall trend continue to remains bearish mainly on account of prolong wait for government action on reform front combined with recent qualms over India's growth story, which GDP falling around decade's low level. Pressure also seems to be coming in from the stocks of Consumer Durable, Auto and Power counters. Auto stocks have been on selling spree ever since the reports highlighted car sales slowing at nine month low of 6.17% in July. However, Competition Commission of India (CCI) probe against car makers for alleged restrictive and monopolistic trade practices, is also adding the somber.
Further daunting global set-up is also discouraging to put into their money into risky bets such as equities. Asian shares snapping four-day rally, continue to trade on disappointing note after China's July trade data falling far short of expectations, casted doubts on whether the sputtering global economy will regain traction any time soon. Meanwhile, European markets too started off on pessimistic note after sluggish Chinese trade data, reignited worries about global growth outlook.
Closer home, state run State Bank of India putting up a disappointing Q1 show has plunged over 2%. Although the bank has registered a surge of 136.91% in its net profit at Rs 3751.56 crore for the quarter under review as compared to Rs 1583.55 crore for the same quarter in the previous year. However, the disappointment emerged after banks gross non-performing assets (NPAs) rose to 4.99% in the April-June quarter as against 3.52% in the same quarter previous year while net NPAs increased to 2.22%. The overall market breadth on BSE is in the favour of declines which thumped advances in the ratio of 1248:1122, while 126 shares remained unchanged.
The BSE Sensex is currently trading at 17,538.34, down by 22.53 points or 0.13% after touching a high of 17,563.46 and a low of 17,501.95. There were 11 stocks advancing against 19 declines on the index, while two remained unchanged.
The broader indices were trading in green; the BSE Mid cap index was up by 0.13%, while Small cap index was up by 0.07%.
The top gaining sectoral indices on the BSE were FMCG up by 0.49%, TECk up by 0.40%, IT up by 0.39%, Oil & Gas up by 0.37%. While, CD down by 1.29%, Auto down by 1.10%, Power down by 0.55%, CG down by 0.53% and Realty down by 0.48% were the top losers on the index.
The top gainers on the Sensex were Maruti Suzuki up by 1.17%, Sterlite Industries up by 1.14%, TCS up by 1.04%, SBI up by 0.85% and ITC up by 0.75%. On the flip side, Tata Motors down by 2.24%, Hero MotoCorp down by 2.23%, Bajaj Auto down by 1.32%, BHEL down by 1.28% and Tata Power down by 1.19% were the top losers on the Sensex.
Meanwhile, after tyre companies, competition Watchdog, the Competition Commission of India (CCI) has now shifted its focus to car makers for alleged restrictive and monopolistic trade practices. Further towards this development, the commission has initiated a probe against automobile companies for anti-competitive practice, which includes restricting dealers to sell rival brands and availability of spares to consumers, which in turn impact the prices and services provided to automobiles on use.
Complaints received by ministry of labour and employment on this score mainly triggered an investigation by competition watchdog, which last time imposed a hefty penalty of Rs 6307 crore on Cement companies guilty of cartelization. The commission will be investing whether auto dealers could diversify their offerings as per their customer's choice. CCI besides looking into complaints on limiting access to services of automobiles to their 'authorised outlets' at exorbitant rates, will probe on the aspect whether the customers are able to received their insurance claims and other damages repaired only if done through the companies' authorized service centre's.
Further, towards the fag end of the last month, CCI also accused tyre companies on forming cartel. The Monopolies and Restrictive Trade Practices (MRTP) report on the matter alleged five tyre companies, controlling over 95% of the market share, too have acted in a concerted manner.
The S&P CNX Nifty is currently trading at 5,314.00, down by 8.95 points or 0.17% after trading in a range of 5,323.40 and 5,303.75. There were 16 stocks advancing against 34 declines on the index.
The top gainers of the Nifty were BPCL up by 2.06%, Sterlite Industries up by 1.28%, Maruti Suzuki up by 1.12%, TCS up by 1.10%, and Cairn India up by 1%. On the flip side, Ranbaxy down by 3.13%, Tata Motors down by 2.42%, Reliance Infra down by 2.34%, IDFC down by 2.15% and Hero MotoCorp down by 1.92%, were the major losers on the index.
Most of the Asian indices were trading in red; Nikkei 225 declined 0.97%, Jakarta Composite slid 0.13%, KLSE Composite down by 0.15%, Shanghai Composite inched lower by 0.08%, Straits Times shed 0.07% and Hang Seng descended 0.86%, while Kospi Composite Index up by 0.30%, Taiwan Weighted added 0.10%.
European markets have got off to a red start; CAC 40 is trading lower by 0.63%, DAX plunged by 0.53% and FTSE 100 tumbled 0.18%.
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