Markets trade lower ahead of Jan F&O expiry

Markets remain rangebound in a tight range on caution ahead of Jan F&O expiry

I ndian equity shares are trading lower in tandem with global markets with the US Federal Reserve maintaining status quo on interest rates and ahead of F&O expiry for the January series.

At 1.17PM, the 30-share Sensex is down 118 points at 29,441 and the 50-share Nifty has shed 37 points at 8,877.

Yesterday, the Sensex touched its new all-time high level of 29,786.32 and Nifty reached its fresh record-high level of 8,985.05 in today’s session.

In the broader market, the BSE Midcap index, down 0.2% and Smallcap index, trading flat, have performed marginally better than the front-liners. Market breadth on the BSE is negative with 1,428 declines against 1,250 advances.

Meanwhile, foreign institutional investors were net buyers in Indian equities worth Rs 1,723 crore on Wednesday, as per provisional stock exchange data.

Global Market:

Asian stocks fell, tracking declines in U.S. equities, after the Federal Reserve cited international risks to the American economy and oil slumped below $45 per barrel. The Shanghai Composite lost 1.33%, Hong Kong’s Hang Seng down 1.1% and Japan’s Nikkei Stock Average fell 1.1%. 

Overnight, US stocks closed down on Wednesday, driven by a sharp decline in the S&P 500 energy sector, after the Federal Reserve said the domestic economy was growing at a solid pace, signaling it remains on track to raise interest rates later this year, Reuters reported. The Dow Jones industrial average fell 1.13%, the S&P 500 fell 1.35% and the Nasdaq Composite slipped 0.9%.

Local Currency:

The rupee fell by seven paise to 61.48 against the dollar on Thursday at the Interbank Foreign Exchange due to appreciation of the Greenback against other currencies overseas.

Crude Oil:

Oil slumped with crude prices at near six-year lows, after the government reported record-high inventories in the United States that raised anxieties about the global oil glut that had pressured the market since last summer.

Hot Stocks:

On the sectoral front, BSE Realty is the top gainer up over 2.5% followed by BSE Oil & Gas index up over 1.4%. On the other hand, BSE Metal is the top loser down 1% followed by Auto and Bankex.

Financials are weighing on the markets in the opening deals. HDFC, ICICI Bank, SBI and Axis Bank have declined over 1% each. Housing finance major, HDFC has lost 1.2% ahead of its third-quarter results due later today.

HDFC Bank has gained around 1.5%. The company has announced plans to raise Rs 10,000 crore through share sale.

ONGC has declined around 0.7%. Oil slipped to $49 a barrel on Wednesday after an industry report said US crude stocks rose the most in two decades last week, and as a firmer dollar added to pressure on prices.

RIL is trading higher by 2.5%. According to media reports, RIL has won the contract to supply diesel to the Indian Railways replacing Indian Oil Corporation.

Coal India has declined close to 3% ahead of the government's 5% stake sale by the Offer-for-Sale route by the government tomorrow.

Metal stocks are under pressure. Sesa Sterlite has lost 2%, Hindalco is down 0.2% and Tata Steel is down by 2%. Tata Steel will soon start operation of its Sukinda chromite mine in Jajpur district following the third renewal of the mining lease by the state government recently.

Dr Reddy’s Lab is up 2%. Dr. Reddy's laboratories Dec-quarter consolidated net profit 5.75 billion rupees.

Infosys has lost nearly 0.5%. Jefferies downgrades Infosys to underperform from hold; cuts price target to 1,790 rupees from 2,040 rupees.