Indian bourses continue to trade under pressure

Indian bourses continued their weak trade in early afternoon session on widespread sell-off triggered by a rout in global equity markets. Cautiousness remained in the markets with the report that foreign portfolio investors have turned wary on Indian shares again owing to the recent global market sell-off triggered by rising bond yields in developed markets including in the US and the eurozone. FPIs have sold shares worth Rs 3,665.6 crore in the domestic stock market (including provisional data of Wednesday and Thursday) in February after pumping close to Rs 13,000 crore into Indian equities in January. Investors failed to draw any sense of relief with private report highlighting that fears of the Reserve Bank of India going for a rate hike are overdone and there is still room for a 25 bps rate cut in the August monetary policy review, provided rains are normal. The rupee has also come under pressure, falling 7 paise to 64.35 against US dollar in early trade at the forex market. In scrip specific development, Surya Roshni was up by over nine percent on bagging orders for supply of LED Street Lights under SLNP and for Supply of LED tube lights aggregating to Rs 83.86 crore from Energy Efficiency Services.

On the global front, Asian markets were trading in red, after the Dow Jones industrials on Wall Street plummeted more than 1,000 points, deepening a weeklong sell-off. Back home, the BSE Sensex is currently trading at 33928.32, down by 484.84 points or 1.41% after trading in a range of 33849.65 and 34017.73. There were 4 stocks advancing against 27 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.70%, while Small cap index was down by 0.42%.

The only gaining sectoral indices on the BSE were Realty up by 0.58% and Metal up by 0.13%, while Bankex down by 1.91%, Telecom down by 1.42%, TECK down by 1.34%, IT down by 1.29% and Oil & Gas down by 1.23% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 1.21%, Asian Paints up by 0.69%, Coal India up by 0.03% and Power Grid up by 0.03%. On the flip side, ICICI Bank down by 3.06%, Axis Bank down by 2.93%, Yes Bank down by 2.42%, Adani Ports & SEZ down by 2.22% and HDFC down by 2.12% were the top losers.

Meanwhile, the Indian IT trade body, National Association of Software and Services Companies (NASSCOM) has said that prospect for the Indian information technology (IT) sector is ‘cautiously optimistic’ in the calendar year (CY) 2018 as challenges continue amidst prospects of greater IT spending with global and US economies improving. It also dismissed any speculation about 2018 being the revival year for the sector, explaining that major revivals take time.

Nasscom President R Chandrashekhar has agreed that no doubt the global outlook was looking up as the global economy, the US economy and all of that are all looking positive. Adding further, he pointed out that the short-term prognosis for the global economy is good; US economy is doing well, which usually does translate into greater IT spending, even though it may not be visible today. However, he warned that it does not immediately translate into bigger prospects for the domestic IT industry and also said that the industry needs to tread with caution as there is always a phase-lag and that many things can happen in-between.

Chandrashekhar further said that old challenges continue and none of them have disappeared, and some of them may have abated, while some others may have reduced either in immediacy or in their magnitude of impact. He also said that there are new ones like continued small administrative actions in the US which have been there that don't individually have a big impact, but collectively they add up to a number of negatives. So, he noted that all those things are now a part of business in a global industry which is dealing with de-globalisation and anti-globalisation.

The CNX Nifty is currently trading at 10420.85, down by 156.00 points or 1.47% after trading in a range of 10398.20 and 10453.90. There were 6 stocks advancing against 44 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 1.38%, Asian Paints up by 0.71%, Lupin up by 0.55%, Power Grid up by 0.21% and HCL Tech. up by 0.19%. On the flip side, Aurobindo Pharma down by 3.09%, Axis Bank down by 3.05%, ICICI Bank down by 2.91%, Tech Mahindra down by 2.71% and Yes Bank down by 2.52% were the top losers.

All the Asian markets were trading in red; Hang Seng decreased 1024.25 points or 3.36% to 29,427.02, Nikkei 225 was down by 508.24 points or 2.32% to 21,382.62, Taiwan Weighted shed 156.77 points or 1.49% to 10,371.75, Shanghai Composite decreased 152.28 points or 4.67% to 3,109.77, Jakarta Composite dropped 72.13 points or 1.1% to 6,472.51, KOSPI Index dipped 43.85 points or 1.82% to 2,363.77 and FTSE Bursa Malaysia KLCI decreased 17.86 points or 0.97% to 1,821.58.