Indian bourses continue weak trade; Realty, Metal drag

Indian bourses continued their weak trade in the afternoon session on broad based selling with frontline gauges trading below their crucial 26,000 (Sensex) and 8,000 (Nifty) levels, suffering losses of around one and half percent. The sentiments were under pressure after a private report stated that India's economic growth is expected to fall by up to 1 percentage points over the next 12 months in the wake of demonetisation, while longer-term gains will depend on follow-up reforms. Sentiments remained dampened with the Centre and States on Sunday failing to reach a consensus on who will control which set of assessees under GST. The said meeting which came ahead of the formal meeting of the all powerful GST Council on November 25, was held after the Centre and states were deadlocked over the issue at two previous meetings. The GST Council will meet again on November 25 to work out the modalities. Besides, depreciation in Indian rupee against the dollar,  too aided pessimism on the street. Indian rupee fell to over 8-month low and was trading at 68.20 against the dollar as sentiment turned bearish on combination of growing US rate hike expectations and stunning dollar run.

On the global front, Asian markets were trading mostly in green despite the weak cues from Wall Street and continuing uncertainty about the economic policies of U.S. president-elect Donald Trump. Back home, in scrip specific development, Alembic Pharmaceutical was up by around three percent after the company received approval from the US Food & Drug Administration (USFDA) for its Abbreviated New Drug Application (ANDA) for Telmisartan and Amlodipine Tablets. The BSE Sensex is currently trading at 25807.35, down by 342.89 points or 1.31% after trading in a range of 25777.21 and 26270.28. There were 4 stocks advancing against 26 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 2.28%, while Small cap index was down by 2.75%.

The only gaining sectoral indices on the BSE were IT up by 0.43% and TECK up by 0.15%, while Realty down by 4.11%, Metal down by 2.93%, Bankex down by 2.77% and Auto down by 2.65%, Capital Goods down by 2.29% were the losing indices on BSE.

The top gainers on the Sensex were Wipro up by 1.35%, Infosys up by 0.49%, TCS up by 0.37% and GAIL India up by 0.16%. On the flip side, Adani Ports &Special down by 5.08%, SBI down by 4.62%, Tata Steel down by 4.15%, Tata Motors down by 3.38% and Mahindra & Mahindra down by 3.00% were the top losers.

Meanwhile, in order to discuss issues relating to exports and effects of demonetization, Commerce and Industry Minister Nirmala Sitharaman has called a meeting of export promotion councils and other sector representatives including sectors from pharmaceuticals and textiles on November 21.

After recording negative growth for about two-years, exports have started recording positive growth. The outbound shipments continued to grow for the second month in a row, expanding by 9.59 per cent to $ 23.51 billion in October on healthy growth in shipments of jewellery and engineering products. Traders are worried that the move has implications on the supply side and demonetisation would impact exporters particularly small and medium units as most of them still deal in cash.

Expressing anxieties on the development, Council of Leather Exports (CLE) Chairman Rafeeq Ahmed has said that the move to put limitations on cash withdrawal which is impacting the working capital of exporters as they have to pay cash for certain perks like overtime and extra incentives to labourers. Temporary workers too demand cash. Further, trade experts have said that the move has implications on the supply side.

On November 8, 2016, the government had declared demonetisation of Rs 500 and Rs 1,000 note and replace them with new Rs 500 and Rs 2,000 notes to curb corruption and make efforts to recover ‘black’ or unaccounted money.

The CNX Nifty is currently trading at 7955.85, down by 118.25 points or 1.46% after trading in a range of 7943.40 and 8102.45. There were 7 stocks advancing against 43 stocks declining on the index.

The top gainers on Nifty were Bharti Infratel up by 2.64%, Wipro up by 1.34%, HCL Tech. up by 1.13%, Tech Mahindra up by 0.94% and Infosys up by 0.46%. On the flip side, Bank of Baroda down by 8.51%, Adani Ports &Special down by 5.57%, Eicher Motors down by 4.73%, SBI down by 4.64% and Hindalco down by 4.45% were the top losers.

The Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 2.48 points or 0.15% to 1,626.28, Shanghai Composite increased 16.3 points or 0.51% to 3,209.16, Taiwan Weighted increased 32.32 points or 0.36% to 9,041.11 and Nikkei 225 increased 138.61 points or 0.77% to 18,106.02. On the flip side, Jakarta Composite decreased 22.11 points or 0.43% to 5,147.80, Hang Seng decreased 18.4 points or 0.08% to 22,325.81 and KOSPI Index decreased 8.53 points or 0.43% to 1,966.05.