Geopolitical worries drag markets lower in early deals

Extending southward journey, Indian equity benchmarks have made a pessimistic start and are trading with a cut of around one third of a percent, with Sensex and Nifty breaching their crucial 31,900 and 9,950 levels in early deals on Wednesday. Geopolitical worries mainly weighed on the sentiments with remarks by President Donald Trump adding to concerns about rising tensions between the US and North Korea. Back on domestic turf, traders continued to remain worried after capital market regulator SEBI directed exchanges to initiate action against 331 suspected shell companies. Investors failed to get any support with the government’s statement that job loss through automation in India should not be a matter of concern as the 'growth momentum' of the economy will result in new job opportunities. Moreover, Union Power Minister Piyush Goyal’s statement that the newly-introduced Goods and Services Tax (GST) is crucial for promoting transparency and a corruption-free business environment in the country, too failed to provide markets any strength.

Global cues too dampened sentiments with most of the regional peers trading in red at this point of time, as tensions on the Korean peninsula escalated, with Pyongyang saying it is considering plans to attack Guam. The US markets made a mildly lower closing in the last session that ended the Dow’s streak of setting new record closing highs for nine consecutive sessions.

Back home, stocks related to sugar space edged higher with report that India is planning to allow additional 200,000 tonnes of duty-free sugar imports, as production fell below consumption in 2016/17 marketing year ending on Sept 30. Meanwhile, the market breadth indicating the overall health of the market was weak, with 541 shares gaining and 1,359 shares declining, while a total of 71 shares were unchanged.

The BSE Sensex is currently trading at 31899.74, down by 114.45 points or 0.36% after trading in a range of 31843.45 and 31933.04. There were 10 stocks advancing against 21 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 0.48%, while Small cap index was down by 0.52%.

The top gaining sectoral indices on the BSE were Metal up by 0.98%, PSU up by 0.55%, Oil & Gas up by 0.53%, Utilities up by 0.45% and Energy was up by 0.32%, while Healthcare down by 1.58%, FMCG down by 0.73%, Industrials down by 0.49%, Bankex down by 0.39% and Capital Goods was down by 0.36% were the top losing indices on BSE.

The top gainers on the Sensex were NTPC up by 0.99%, Power Grid Corporation up by 0.99%, SBI up by 0.82%, Adani Ports up by 0.43% and TCS up by 0.35%. On the flip side, Sun Pharma down by 2.57%, Dr. Reddys Lab down by 1.97%, Tata Motors - DVR down by 1.23%, ICICI Bank down by 1.10% and Tata Motors down by 1.09% were the top losers.

Meanwhile, in a bid to make drugs more affordable in India, the government has constituted a committee of joint secretaries, which will ensure enhanced affordability, availability and accessibility of drugs for the citizens. Minister of State for Chemicals and Fertilisers Mansukh L Mandaviya has said that the committee will suggest ways to make pricing policy in favour of poor patients.

The committee will also review the scope of Drugs (Price Control) Order 2013 (DPCO 2013) and suggest ways for strengthening the regulatory provisions of the order. It will also delve into making the existing mechanisms for collection of market based data on prices of medicines more robust and will suggest ways for strengthening the existing pharmaceutical database management system.

Moreover, the panel will also look at procedural improvements and process of re-engineering in NPPA to ensure better and quicker implementation of the government policy and bring greater transparency so as to reduce litigations and review petitions.

The CNX Nifty is currently trading at 9946.65, down by 31.90 points or 0.32% after trading in a range of 9925.90 and 9961.20. There were 16 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 2.43%, Indian Oil Corporation up by 2.08%, Vedanta up by 2.00%, NTPC up by 1.11% and SBI up by 0.86%. On the flip side, Aurobindo Pharma down by 3.30%, Sun Pharma down by 2.57%, Dr. Reddys Lab down by 1.71%, ICICI Bank down by 1.35% and Tata Motors - DVR down by 1.25% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 declined 283.11 points or 1.42% to 19,712.90, Hang Seng decreased 225.23 points or 0.81% to 27,629.68, Taiwan Weighted dropped 84.72 points or 0.8% to 10,484.25, KOSPI Index shed 19.6 points or 0.82% to 2,375.13, Shanghai Composite slipped 6.87 points or 0.21% to 3,275.01 and FTSE Bursa Malaysia KLCI was down by 4.26 points or 0.24% to 1,777.39.

On the flip side, Jakarta Composite was up by 2.53 points or 0.04% to 5,813.09.