Indian bourses continue to trade in negative terrain

Indian bourses continued their weak trade in the afternoon session on broad based selling, with frontline gauges trading below their crucial 27,500 (Sensex) and 8,500 (Nifty) levels. Sentiments were dampened with the report indicating that India's economy lost momentum in the final three months of 2016 after Prime Minister Narendra Modi's ban on high-value notes hurt consumption and businesses. Having posted growth of above 7% for six consecutive quarters, India's gross domestic product is expected to have expanded just 6.5% in the October-December quarter - the weakest in nearly three years. Caution prevailed in the markets ahead of US President-elect Donald Trump’s inauguration later in the day. Broader market sentiment was also subdued even after China's fourth-quarter economic growth beat expectations and Federal Reserve Chair Janet Yellen took a less hawkish policy stance.  However, traders took some support with report that India emerged as the 'sweet spot' along with neighbour China to accelerate world economic growth. India was also commended as a major driving force along with China for world growth with leaders and economists stressing the need for increased regional cooperation. In scrip specific development, Bajaj Auto was trading in green after unveiling the new variants of the KTM RC range, comprising the RC 390 and the RC 200, in India.

On the global front, Asian markets were trading mostly in red as investors remained cautious ahead of U.S. President-elect Donald Trump's inauguration later in the day. Investors also digested a raft of Chinese economic data, including better-than-expected GDP growth. The National Bureau of Statistics has said Friday that China's gross domestic product expanded 6.8 percent on year in the fourth quarter of 2016.

The BSE Sensex is currently trading at 27213.87, down by 94.73 points or 0.35% after trading in a range of 27176.32 and 27264.41. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.20%, while Small cap index was up by 0.07%.

The top gaining sectoral indices on the BSE were FMCG up by 0.29% and Realty up by 0.04%, while PSU down by 0.80%, Bankex down by 0.76%, Metal down by 0.75%, Consumer Durables down by 0.70% and Oil & Gas down by 0.67% were the losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 2.94%, Asian Paints up by 1.01%, Cipla up by 0.91%, HDFC Bank up by 0.74% and Hindustan Unilever up by 0.73%. On the flip side, Axis Bank down by 5.26%, ICICI Bank down by 1.58%, Power Grid down by 1.49%, ONGC down by 1.42% and Coal India down by 1.12% were the top losers.

Meanwhile, making a strong defence of demonetisation, Commerce Minister Nirmala Sitharaman has said that the government owed such a step to the nation for eliminating the black money menace and to bring hoarded cash back into the banking system. 

During a panel decision, on 'India's Time to Transform', at the annual World Economic Forum meeting in Davos, Sitharaman has said that the demonitisation move may sound 'propagandist' but one needs a strong and courageous leadership to take such a bold step. She also said that the move was absolutely necessary as 87 per cent of economy was informal and only in cash-driven segments where money would not go into the banking system. She added that only about 50 lakh people pay tax and all others who file the returns do not file any tax.

Talking about why government felt it was essential to do the demonetization, she said that it was part of the electoral promise they made to check the black money menace. She also said that after coming to power, they started with setting up the special investigation team, came out with scheme for declaration of undisclosed money, and tightened tax treaties with different countries to check round tripping of money. The Minister further said that no part of the country faced any problem because the ministers and officials were moving around the country to take stock of situation and to take necessary measures throughout this 50-day period.

The CNX Nifty is currently trading at 8412.00, down by 23.10 points or 0.27% after trading in a range of 8397.05 and 8423.65. There were 16 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were Idea Cellular up by 4.47%, Bharti Airtel up by 2.87%, Grasim Industries up by 1.96%, Yes Bank up by 1.96% and Ultratech Cement up by 1.68%. On the flip side, Axis Bank down by 5.26%, Tata Motors - DVR down by 1.87%, ICICI Bank down by 1.61%, Bharti Infratel down by 1.45% and ONGC down by 1.42% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 102.57 points or 0.44% to 22,947.39, Jakarta Composite declined 31.3 points or 0.59% to 5,267.65, KOSPI Index shed 7.18 points or 0.35% to 2,065.61 and FTSE Bursa Malaysia KLCI was down by 0.9 points or 0.05% to 1,665.61.

On the flip side, Taiwan Weighted increased 13.34 points or 0.14% to 9,331.46, Shanghai Composite rose 22.62 points or 0.73% to 3,123.92 and Nikkei 225 was up by 65.66 points or 0.34% to 19,137.91.