Weak trade persist in morning session

Indian equity benchmarks continued their weak trade in the morning session on account of selling in front line blue chip counters. Geopolitical concerns over the Korean Peninsula have remained under the spotlight as the Trump administration has attempted to put more pressure on North Korea. In turn, North Korean leader Kim Jong Un said that Trump would pay dearly for his speech at the United Nations earlier this week. The domestic currency was trading down against dollar in early trade. Rupee hit 65 level against the US dollar for the first time in more than five months amid geopolitical concerns and fears that the US Federal Reserve left the door open for an interest rate hike by December end. Traders remained cautious after the Organisation for Economic Co-operation and Development (OECD) trimmed India’s growth forecast for the current financial year, citing the temporary impact of the rollout of the Goods and Services Tax (GST) and demonetization, expecting the economy to expand at a slower pace than China. OECD said India’s economy will likely grow 6.7% in FY18, lower than its estimate of 7.3% in June. The Paris-based group of 35 advanced and emerging countries cut its forecast for India’s growth to 7.2% in FY19 from 7.7% estimated earlier.

Investors took note of foreign brokerage report that a slowdown in growth is likely to create pressure on the government to announce an economic stimulus package. But it could have an adverse impact on near-term macroeconomic stability. Besides, there could be long-term implications on growth, the way it happened with the 2008-09 fiscal stimulus package. The report added that a whopping Rs 65,000 crore stimulus could be on cards, which could mean Asia’s third largest economy may have to again take leave from its fiscal targets. Public sector bank extended the losses after credit rating agency, ICRA in its report enlightened that private sector banks have far outstripped their public sector peers when it comes to growing their loan book. Private Banks have cornered the entire share of incremental loan growth and may increase their share from 38 to 40% by FY’20.

Traders were seen selling in Metal, Basic Materials and Realty sector stocks. In scrip specific development, New Delhi Television (NDTV) is locked at upper circuit limit on media report that founder and owner of SpiceJet Ajay Singh has picked up majority stake in the news channel. The report further added that Ajay Singh will hold around 40% stake in NDTV while promoters Prannoy Roy and Radhika Roy will hold around 20% in the company. Reliance Home Finance, the subsidiary of Reliance Capital, is locked at percent upper circuit.

On the global front, Asian markets were trading in red, on possibility of North Korea conducting another hydrogen bomb test, this time in the Pacific Ocean. Standard and Poor’s has lowered Hong Kong’s long-term rating from AAA to AA+ following its earlier downgrade of China’s sovereign rating. Back home, the BSE Sensex and NSE Nifty were trading below the psychological 32,200 and 10,050 levels respectively. The market breadth on BSE was negative in the ratio of 492:1646, while 89 scrips remained unchanged.

The BSE Sensex is currently trading at 32120.14, down by 249.90 points or 0.77% after trading in a range of 32072.31 and 32342.81. There were 5 stocks advancing against 26 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 1.27%, while Small cap index was down by 1.27%.

The top losing sectoral indices on the BSE were Metal down by 1.94%, Basic Materials down by 1.74%, Realty down by 1.64%, Oil & Gas down by 1.55% and PSU down by 1.51%, while there were no gainers on BSE.

The top gainers on the Sensex were Tata Motors up by 1.81%, Tata Motors - DVR up by 1.59%, Sun Pharma up by 0.72%, Cipla up by 0.60% and Wipro up by 0.52%.

On the flip side, Tata Steel down by 1.78%, ICICI Bank down by 1.67%, SBI down by 1.55%, Asian Paints down by 1.42% and Axis Bank down by 1.41% were the top losers.

Meanwhile, the Government’s 100 smart cities mission seeks to invest over $15 billion in the next few years to build efficient and effective city management solutions and infrastructure. MV Rajeev Gowda, Member of Parliament said, 'The Union Government’s 100 Smart Cities mission seeks to invest over $15 billion in the next years to build efficient and effective city management solutions and infrastructure and in moving towards this reality of smart cities, the right choice would be to create and build the urban cityscape and framework - with global best practices at the core and local realities and challenges addressed with a holistic approach.'

Gowda further said that the paradigm of smart cities calls for a convergence of strategies and technologies that will bring to the fore holistic solutions for accelerated growth and development. Mohan Raju, Chief Strategy Officer, Azuga Inc & Director-IET IoT Panel said, “Smart cities projects in India shall establish radically new standards to ensure the effective use of technology to deliver services and manage complex civic problems. He further said that these new needs shall invite participation of international stakeholders as well as various startup ecosystems in the country to unearth indigenous solutions to age-old problems

Recently, to promote competition among Smart Cities and measure the quality and impact of projects undertaken under the flagship programme, the housing and urban affairs ministry has launched Smart Cities Awards Contest, 2017, with a total prize money of over Rs 50 lakh. Prime Minister Narendra Modi had launched the ambitious plan to develop 100 Smart Cities in June 2015. The Smart Cities programme is meant to upgrade urban infrastructure in cities, majority of which fare poorly on various socio-economic indicators.

The CNX Nifty is currently trading at 10023.05, down by 98.85 points or 0.98% after trading in a range of 10011.65 and 10095.05. There were 8 stocks advancing against 43 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 1.80%, HCL Technologies up by 1.56%, Tata Motors - DVR up by 1.31%, Bharti Infratel up by 0.90% and Sun Pharma up by 0.74%.

On the flip side, Yes Bank down by 3.59%, Hindalco down by 2.86%, Ultratech Cement down by 2.40%, Vedanta down by 2.34% and Indian Oil Corporation down by 2.15% were the top losers.

The Asian markets were trading in red; Hang Seng decreased 238.23 points or 0.85% to 27,872.10, Taiwan Weighted decreased 123.41 points or 1.17% to 10,455.03, Nikkei 225 decreased 54.36 points or 0.27% to 20,293.12, KOSPI Index decreased 20.53 points or 0.85% to 2,385.97, Shanghai Composite decreased 17.56 points or 0.52% to 3,340.25 and Jakarta Composite decreased 1.9 points or 0.03% to 5,904.67.

The markets in Malaysia are closed for the Islamic New Year.