Published on 29/06/2020 1:38:53 PM | Source: LKP Securities Ltd

Benchmarks continue dull trade in late afternoon session - LKP Securities

Posted in Market Outlook| #Market Outlook #LKP Securities Ltd

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Indian bourses continued their trade in red terrain in the late afternoon session, on the back of sustained selling activities by market-participants amid weakness across Asian peers. Weak broader indices along with heavy sell off at metal, realty and capital goods counters dragged the markets lower. Sentiments remained undermined as S&P Global Ratings’ report titled 'Asia-Pacific losses near $3 trillion as balance sheet recession looms’ has said Indian economy is in deep trouble with growth expected to contract by 5 percent in this year before rebounding in 2021 on account of difficulties in containing the virus, an anemic policy response, and underlying vulnerabilities, especially across the financial sector. Meanwhile, reversing the three-month selling streak in June, foreign portfolio investors (FPIs) pumped in a net Rs 21,235 crore in domestic markets amid increasing liquidity and gradual opening up of economy.

On the global front, Asian markets were trading lower in line with worries of another business lockdown and other containment measures as the COVID-19 pandemics soar to record levels day after day. Back on street, in scrip specific developments, Emami declined as the company reports disappointing set of numbers for the quarter ended March 2020 (Q4FY20), impacted severely by the Covid-19 pandemic, while IDBI Bank moved up on getting nod to sell upto 27% stake in IFLI .


The BSE Sensex is currently trading at 34775.46, down by 395.81 points or 1.13% after trading in a range of 34662.06 and 34958.90. There were 4 stocks advancing against 26 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 1.55%, while Small cap index was down by 1.48%.

The only gaining sectoral indices on the BSE were FMCG up by 1.03%, while Metal down by 3.64%, Realty down by 2.78%, Capital Goods down by 2.45%, PSU down by 2.43%, Basic Materials was down by 2.16% were the top losing indices on BSE.

The top gainers on the Sensex were ITC up by 1.67%, Hindustan Unilever up by 1.37%, Nestle up by 0.32% and Sun Pharma was up by 0.31%. On the flip side, Axis Bank down by 4.25%, Bajaj Finance down by 3.62%, Tata Steel down by 2.93%, Larsen & Toubro down by 2.92% and Tech Mahindra was down by 2.83% were the top losers.

Meanwhile, Automotive Component Manufacturers Association of India (ACMA) Director General Vinnie Mehta has said that the auto components industry in India should look at enhancing exports and aspire for at least 5 percent of the global trade share in the next five years. He noted that the global trade in auto components is $1.3 trillion and the Indian auto component industry has a minuscule share of 1.3 percent.

For achieving 5 percent of global trade target, Mehta said the government support in terms of favourable policies would be crucial. He pointed out that support from the government would act as a catalyst for business growth as well as help the industry become self-reliant. He added that while the industry will have to deliver technologically relevant, globally price-competitive products with consistent quality, the government will have to ensure ease of doing business in its true sense and to overcome disabilities of capital logistics and energy.

Currently, the Indian auto component industry exports 25 percent of its production -- $15.1 billion, with the US and the EU accounting for 65 percent of exports. Besides, in 2018-19, the Indian auto component industry's revenue stood at $57 billion, contributing 2.3 percent to the country's gross domestic product (GDP). In comparison, turnover of Chinese auto component industry stood at $550 billion last year.

The CNX Nifty is currently trading at 10254.05, down by 128.95 points or 1.24% after trading in a range of 10223.60 and 10325.90. There were 7 stocks advancing against 43 stocks declining on the index.

The top gainers on Nifty were Britannia up by 1.94%, ITC up by 1.66%, Cipla up by 1.37%, Hindustan Unilever up by 1.35% and Sun Pharma was up by 0.30%. On the flip side, Hindalco down by 4.73%, Coal India down by 4.50%, Axis Bank down by 4.24%, Zee Entertainment down by 4.03% and Bajaj Finance was down by 3.60% were the top losers.

All Asian markets were trading lower; KOSPI fell 41.17 points or 1.93% to 2,093.48, Jakarta Composite lost 24.19 points or 0.49% to 4,879.90, Nikkei 225 slipped 517.04 points or 2.3% to 21,995.04, Straits Times trembled 26.06 points or 1% to 2,578.45, Shanghai Composite declined 23.07 points or 0.77% to 2,956.48, Taiwan Weighted dropped 118.05 points or 1.01% to 11,542.62 and Hang Seng was down by 310.46 points or 1.26% to 24,239.53.


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