Mumbai, Aug 31: Domestic equity benchmarks opened lower on Monday weighed down by weakness across Asian markets and a sharp rise in crude oil prices amid renewed tensions in the Middle East.

Sensex opened at 77,130.73, down 133.78 points or 0.17 per cent, while Nifty fell 58.10 points or 0.24 per cent to 24,117.55.

Sector-wise, Nifty Metal was top loser and fell 1.70 per cent, followed by Nifty IT which declined 1.32 per cent. Nifty Media and Nifty PSU Bank also fell up to 1 per cent.

Other sector indices, realty, cement, chemicals and FMCG declined between 0.73 per cent and 1 per cent.

In contrast, Nifty Private Bank was trading marginally positive, edging up 0.06 per cent in early trade.

“Monday’s trading begins with the market facing a few headwinds. From the global equity market perspective, sentiments have turned slightly negative following Fed chief Kevin Warsh’s statement that if inflation persists at rates higher than the Fed’s long-term target, ‘we have work to do’,” said market experts.

The comments have been interpreted by the market as a signal of a possible rate hike at the FOMC meeting scheduled for September 15-16. The resulting rise in bond yields is negative for equities, they said.

Another headwind is the renewed escalation in tensions between the US and Iran, which has pushed Brent crude above the $90-a-barrel mark. The HDFC Bank stock is also likely to remain in focus and could turn volatile amid speculation over the successor to CEO Sasidhar Jagadishan, the experts added.

“Even if the Nifty comes under pressure, lots of action are likely in the broader market which is attracting big buying in recent weeks. A significant recent trend in the market is that the market is giving more preference to growth than value,” according to them.

On the technical front, Friday’s inside bar pattern has retained hopes of an upswing from the vicinity of 24,060, which would also be consistent with the consolidation band that has been in play for the last eight days.

“However, we would wait for a break above 24,215 to signal strength. Alternatively, inability to float above 24,060 would expose 23,575,” the expert said.

Additionally, the market is also bracing for heightened volatility from MSCI’s index rejig under the new closing auction system, while renewed tensions in the Iran war and developments at HDFC Bank added to investor caution.

Meanwhile, international benchmark Brent crude rose more than 2 per cent to $90.67 a barrel, while US West Texas Intermediate (WTI) crude gained 2.06 per cent to $85.09 a barrel.

Asian markets also remained largely weak. Japan’s Nikkei traded more than 1 per cent lower, while Hong Kong’s Hang Seng fell 0.7 per cent and South Korea’s KOSPI slipped more than 1 per cent.

New Delhi, Aug 29: The Ministry of Petroleum and Natural Gas on Saturday rejected concerns that the revised price of Compressed Biogas (CBG) under the GOBARdhan Scheme could place a significant additional burden on CNG and household PNG consumers, saying the assessment is based on inconsistent assumptions.

The ministry said the existing pricing mechanism links the price paid to CBG producers to 85 per cent of the retail selling price of CNG. Based on the latest revision, this translates into a CBG procurement price of around Rs 1,478 per MMBtu.

Under the revised GOBARdhan framework, the CBG procurement price has been fixed at Rs 2,110 per MMBtu, representing an increase of around 43 per cent over the prevailing price. However, the ministry clarified that this is the procurement price paid to CBG producers and is not the price directly paid by CNG or household PNG consumers.

The government will provide affordability support of Rs 10 per kg of CBG, equivalent to approximately Rs 215 per MMBtu for CBG containing 95 per cent methane. This support will be funded by the government and will reduce the amount that needs to be recovered through gas consumers.

After accounting for the government support, the effective CBG cost to be recovered through the gas consumer base would be around Rs 1,895 per MMBtu, compared with the prevailing effective price of Rs 1,478 per MMBtu. This translates into an effective increase of approximately 28 per cent, significantly lower than the headline increase in the procurement price.

The ministry further clarified that CBG is not sold to City Gas Distribution (CGD) entities at its procurement price. Instead, it is pooled with other domestically produced natural gas, with the cost distributed across the applicable domestic gas pool.

Under the earlier framework, the cost of CBG was spread only across the limited quantity of Administered Price Mechanism (APM) gas allocated to the CNG transport and domestic PNG segments. Under the new framework, however, the net cost of CBG will be distributed across a domestic gas base that is approximately 2.5 to three times larger than the earlier base.

New Delhi, Aug 28: Ex-mill sugar prices in India have declined by around 20 per cent, while retail sugar prices have also started coming down, and given the normal transmission of changes through the supply chain, retail prices are expected to follow the downward movement in prices shortly, the Ministry of Consumer Affairs, Food & Public Distribution said on Friday.

The government has been closely monitoring sugar prices, stocks and movement across the country and has taken a series of proactive measures to ensure that the benefit of adequate availability reaches consumers. The downward trend in ex-mill and retail prices reflects that the sharp spike in prices witnessed recently was primarily on account of hoarding and speculation, although the country carries adequate stocks of sugar, the ministry statement said.

A nationwide drive for physical verification of sugar stocks at mills has reaffirmed the comfortable availability position. In several cases, sugar mills were found to be holding stocks higher than those declared in their monthly returns submitted to the government. The verification exercise has established that there is no shortage of sugar in the country and there is no justification for panic buying or excessive stocking, it said.

In some cases, sugar mills were also found to be resorting to “short selling”, which means selling less sugar than the quantity allocated to them under the monthly quota. Such practices tend to unnecessarily constrain market supplies despite adequate physical stocks, the statement said.

The government has also observed that, in certain cases, sugar sold by mills at the beginning of the month was being dispatched or lifted by buyers only towards the end of the month. This practice contributed to artificial scarcity in the market. To address such issues and ensure that sugar reaches the market in a timely manner, the government has decided to introduce a fortnightly sugar allocation system from September, replacing the existing monthly quota system. Under the fortnightly quota, mills will be required to sell at least 40 per cent of the allocation in the first week and the remaining quantity in the succeeding week.

Sugar mills have already been directed to ensure that sugar sold is dispatched from the mill within seven days of sale. The combination of fortnightly quota allocation and mandatory dispatch within seven days will significantly improve the movement of sugar through the supply chain. It will ensure that sugar moves quickly from mills to dealers and ultimately to consumers, while discouraging unnecessary accumulation and speculative holding of stocks. Bulk consumers of sugar have also been advised not to accumulate stocks in excess of their operational requirements.

Sugarcane crushing for the new season will also commence from October 15, and it is expected that more than 10 LMT of sugar will be produced during the month. The government has also permitted sugar mills to sell sugar produced during October without restriction, ensuring that new-season production becomes available in the domestic market at the earliest. Sugar production is expected to be around 45 LMT in November, providing substantial additional supplies for domestic consumption, the statement added.