Benchmarks continue to trade in red in noon session

Indian equity bourses continued to trade in red in the noon session as funds and retail investors engaged in reducing positions ahead of the expiry of November series futures and options contracts later in the day. Market participants turned jittery after the upbeat US economic data released on Wednesday strengthened the prospects for higher US interest rates. The minutes from the US Federal Reserve’s November policy meet, showed Fed policymakers appeared confident on the eve of the US Presidential election to hike interest rates soon. On the domestic front, sentiments got undermined after the rupee crashed to nearly 39-month low of 68.84, plummeting by another 28 paise against the US dollar on Thursday amid sustained foreign fund outflows and the greenback's surge in overseas markets. Foreign Institutional Investors (FIIs) have withdrawn over Rs 3,700 crore from equity markets this week. Adding anxiety among investors, Commerce and Industry Minister Nirmala Sitharaman said that economic output in the current quarter may get affected, with the government’s demonetization drive temporarily hitting commercial activities in some sectors.

On the global front, Asian stock markets were trading mostly lower on Thursday as upbeat economic data strengthened the prospects for higher US interest rates, while the dollar's bull-run continued as US bond yields hovered near multi-year highs.  Investors fear that higher interest rates in the US will spark capital outflows from the emerging equity markets.  Among the Asian markets, South Korea, Hong Kong, Taiwan, Indonesia and Malaysia edged lower. Bucking the trend, Japanese stocks rose to a near-11-month high, as the yen weakened and after Wall Street shares closed at record highs overnight.

Back home, stocks from IT, Metal and Capital Goods counters were supporting the markets, while those from Power, Auto and Oil & Gas counters were adding to the underlying cautious undertone. In scrip specific development, Cadila Healthcare slipped after the company recalled over 20,500 bottles of anti-depressant Bupropion Hydrochloride extended release tablets from US markets made by the company. On the other hand, UltraTech Cement gained after the company decided to issue unsecured redeemable non-convertible debentures (NCDs) amounting to Rs 400 crore on private placement basis.

The market breadth remained optimistic as there were 1196 shares on the gaining side against 959 shares on the losing side, while 132 shares remained unchanged.

The BSE Sensex is currently trading at 25952.18, down by 99.63 points or 0.38% after trading in a range of 25880.78 and 26049.14. There were 10 stocks advancing against 20 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.26%, while Small cap index up by 0.16%.

The top gaining sectoral indices on the BSE were IT up by 1.04%, TECK up by 0.65%, Metal up by 0.45% and Capital Goods up by 0.01% while, Power down by 0.97%, Auto down by 0.93%, Oil & Gas down by 0.92%, Bankex down by 0.71% and Consumer Durables down by 0.21% were the losing indices on BSE.

The top gainers on the Sensex were Bajaj Auto up by 1.72%, Infosys up by 1.20%, Asian Paints up by 1.17%, TCS up by 1.10% and SBI up by 1.00%. On the flip side, Tata Motors down by 3.33%, NTPC down by 2.31%, ICICI Bank down by 1.57%, Reliance Industries down by 1.41% and Adani Ports &Special down by 1.40% were the top losers.

Meanwhile, supporting the government’s surprise decision to withdraw high-denomination bank notes of Rs 500 and Rs 1,000, Niti Aayog CEO Amitabh Kant has said that India is moving towards a totally formalized economy that will bring huge gains in the long-term.  He said that 'There are long-term gains for the country (from demonetisation). The country will move towards a totally digitised payment economy. It will move towards formalised economy.'

The Niti Aayog CEO added that it is a massive and unparalleled thing that would create some short-term issues but in the long-term there would be huge gains. He further added that India is moving from non-formal economy to a formal economy, therefore the people should have patience and faith.

Earlier, the Vice Chairman of NITI Aayog, Dr. Arvind Panagariya too had said that the crackdown on black money by demonetization will bring down the inflation. The move will ensure that transactions will now go much more through the banking system which will ensure transparency. In order to curb corruption, the government on November 8, had declared demonetization of Rs 500 and Rs 1,000 note replacing them with new Rs 500 and Rs 2,000 notes.

The CNX Nifty is currently trading at 7996.95, down by 36.35 points or 0.45% after trading in a range of 7973.95 and 8013.65. There were 16 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were Tech Mahindra up by 1.73%, Bank of Baroda up by 1.70%, Hindalco up by 1.61%, Bajaj Auto up by 1.33% and Infosys up by 1.22%. On the flip side, Tata Motors down by 3.43%, Tata Motors - DVR down by 2.95%, Zee Entertainment down by 2.67%, NTPC down by 2.25% and Eicher Motors down by 2.11% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 0.34%, Jakarta Composite declined 1.22%, KOSPI Index shed 0.8%, Taiwan Weighted slipped 0.28% and FTSE Bursa Malaysia KLCI was down by 0.37%. On the flip side, Shanghai Composite increased 0.38% and Nikkei 225 was up by 1.05%.