Indian equity markets close lower on profit booking, weak rupee (Roundup)

Mumbai, July 15 (IANS) Key Indian equity markets closed lower on Friday as they were suppressed by profit booking, a weak rupee and lower crude prices.

The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 27,966.14 points, closed at 27,836.50 points — down 105.61 points or 0.38 per cent — from the previous close at 27,942.11 points.

It touched a high of 28,048.70 points and a low of 27,735.87 points during the intra-day trade.

The BSE market breadth was skewed in favour of the bears — with 1,706 declines and 981 advances. Heavy selling pressure was witnessed in information technology (IT) and technology, media and entertainment (TECK) stocks.

The wider 51-scrip Nifty of the National Stock Exchange (NSE) edged down to 8,541.40 points — down 23.60 points or 0.28 per cent.

On Thursday, the benchmark indices closed in the positive territory, supported by positive global cues and a strong rupee.

Initially on Friday, the equity indices opened on a flat note, mainly due to the skepticism prevailing ahead of the earnings of IT major Infosys.

The IT company on Friday reported a growth of 13.4 per cent year-on-year (YoY) in its net profit and 16.9 per cent YoY in its revenue for April-June quarter.

But its lowered annual revenue guidance for fiscal 2016-17 declined to 10-11.5 per cent from 11.8-13.8 per cent projected in April due to currency volatility, which resulted in a plunge in the company’s scrip depressing investors’ sentiments.

The markets were also seen taking a conservative approach after disappointing macro-economic inflation data released on Thursday.

Official data disclosed that the wholesale inflation (WPI) surged to 20-month high of 1.62 per cent in June from 0.79 per cent in May due to a rise in food prices.

Mixed global cues, too, dampened investors’ risk-taking appetite. Moreover, profit booking, lower crude oil prices and a weakening rupee aided to cap gains.

However, healthy progress of the monsoon and expectations of the Goods and Services Tax (GST) bill passing in the monsoon session of parliament beginning Monday helped pare some losses during the late afternoon trading session and provided support to prices at the lower levels.

“With the start of the earnings season, there’s a lot to look forward to. There was a tendency to losses and gains mainly due to profit booking. The Infosys results added momentum to that,” Anand James, Chief Market Strategist at Geojit BNP Paribas Financial Services, told IANS.

“Meanwhile, rupee which had strengthened against dollar all through this week on the back of persistent demand from foreign portfolio investors, also pared gains swiftly,” he said.

“Global cues were positive early in the day, with Chinese second quarter gross domestic product figures beating estimates, but risk appetite withdrew as day progressed, as reports about Nice terror attack weighed on European stocks, and reversed a recovery in sterling,” James added.

According to Vinod Nair, Head of Research, Geojit BNP Paribas Financial Services, investors are expected to stay cautious ahead of a colourless start to the earnings season and Bank of England’s status quo on interest rates.

“Improving global liquidity, good monsoon and the likely passage of the GST bill will limit the extent of the downside,” he said.

Sector-wise, the S&P BSE IT index declined by 5.35 per cent, followed by the TECK index, which fell by 3.94 per cent, and the utilities index dipped by 0.88 per cent.

On the other hand, the S&P BSE automobile index rose by 0.96 per cent, followed by the finance index, which was up 0.63 per cent, and the metals index was up 0.60 per cent.

Major Sensex gainers during Friday’s trade were: Tata Steel, up 3.80 per cent at Rs 372.85; Bharti Airtel, up 3.32 per cent at Rs 378.50; HDFC Bank, up 1.95 per cent at Rs 1,223.60; HDFC, up 1.80 per cent at Rs 1,360.25; and Tata Motors, up 1.48 per cent at Rs 492.90.

Major Sensex losers were: Infosys, down 8.81 per cent at Rs 1,072.25; Tata Consultancy Services, down 3.11 per cent at Rs 2,441.90; Wipro, down 2.81 per cent at Rs 554.65; Coal India, down 1.48 per cent at Rs 319.65; and NTPC, down 1.20 per cent at Rs 156.35.



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