A divergent trend was witnessed in early afternoon trade as the barometer index, the S&P BSE Sensex, was trading with small gains while the Nifty 50 index was trading with small losses. At 12:19 IST, the barometer index, the S&P BSE Sensex, was up 10.73 points or 0.03% at 35,603.23. The Nifty 50 index was down 15.75 points or 0.15% at 10,636.45. Capital goods stocks saw mixed trend.
Domestic stocks edged higher in early trade led by gains in ICICI Bank, Axis Bank and Reliance Industries. Key indices trimmed gains in morning trade. A bout of volatility was seen in mid-morning trade as the key indices erased intraday gains to sink in negative zone.
Investors will focus on interim budget to be announced on Friday, 1 February 2019. The interim budget will be the last one presented by the current NDA government led by Prime Minister Modi, before the 2019 general elections in April.
The Budget session of Parliament will commence from tomorrow. The session will begin with the address of President Ram Nath Kovind to the joint sitting of both the Houses of Parliament in Central Hall. The session will conclude on 13th of next month.
Trading could be volatile this week as traders roll over positions in the F&O segment from the near month January 2019 series to February 2019 series. The January 2019 F&O contracts expire on Thursday, 31 January 2019.
The S&P BSE Mid-Cap index was off 0.21%. The S&P BSE Small-Cap index was up 0.5%.
The market breadth, indicating the overall health of the market, was positive. On the BSE, 1166 shares rose and 1012 shares fell. A total of 141 shares were unchanged.
Capital goods stocks saw mixed trend. ABB India (up 0.06%), BEML (up 0.54%), Bharat Electronics (up 3.05%), L&T (up 1.42%) rose. Siemens (down 0.69%), Thermax (down 0.88%) and Bharat Heavy Electricals (Bhel) (down 0.62%) fell.
Dewan Housing Finance Corporation fell 6.2% to Rs 159.50 even as the company issued clarification after market hours yesterday, 29 January 2019. Shares of Dewan Housing Financial (DHFL) fell 8.01% to end at Rs 170.05 on 29 January 2019.
According to story published on 29 January 2019 by investigative news portal Cobrapost, the primary promoters of DHFL siphoned more than Rs 31000 crore of public money. The story alleges that the scam was mainly pulled off through grants of loans and advances to shell companies. The same money was then re-routed via these dubious companies and parked outside India so as to acquire assets.
DHFL clarified after market hours yesterday, 29 January 2019, that it is a publicly listed housing finance company and is regulated by the National Housing Bank and the Securities and Exchange Board of India, amongst other regulators. This mischievous misadventure by Cobra Post appears to have been done with a mala fide intent to cause damage to the goodwill and reputation of DHFL and resulting in erosion in shareholder value.
Coromandel International rose 1.13%. Coromandel International announced that a fire accident occurred on 28 January 2019, at the product godown in one of its manufacturing units at Sarigam, Gujarat. This unit manufactures crop protection chemicals. The fire has been brought under control and there is no loss or injury to human life. The company has insurance coverage for this and has informed the insurance company about the incident. There is likely to be no significant impact on the company's operations. The company has another unit manufacturing the product and has sufficient stock to meet the market requirements. The announcement was made after market hours yesterday, 29 January 2019.
Overseas, Asian stocks were trading lower on Wednesday as the earnings season rolled on and investors awaited the Federal Reserve's policy meeting. Among key event, Chinese President Xi Jinping's top economic aide, Vice Premier Liu He, will meet with US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin on Wednesday and Thursday.
In US, the S&P 500 and the Nasdaq closed lower Tuesday as investors sorted through a fresh batch of earnings reports and awaited clarity from the Federal Reserve on its monetary policy plans. However, the Dow bucked the broader weakness, buoyed by Pfizer and 3M.
The US Fed began its two-day policy-setting meeting with Chairman Jerome Powell scheduled to hold a news conference to discuss the central bank's plans on Wednesday. Investors are eager for any new communication on the pace of rate increases and a reduction of the central bank's balance sheet as the rapidity of those processes had been cause for concern in recent months.
On the data front, the Conference Board's consumer confidence index fell to 120.2 in January, down from 126.6 in December, according to FactSet data.
In the UK, Parliament passed several amendments on Brexit, including a proposal to extend the Brexit timeline and to postpone the exit date if no deal was found until late February.
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