Sensex, Nifty continue bearish trend; Realty stocks plunge

The local equity benchmarks continued their bearish trend in late afternoon session, with the Sensex and the Nifty falling around 75 and 30 points, respectively, despite firm opening in European markets. Heavy selling in Realty, PSU and Bankex stocks along with sluggish broader indices, weighted on the sentiments. Besides, major industry losers like Axis Bank, SBI and Sun Pharma, were also contributing to the losses. Traders were concerned with a private report stating that inflation is expected to trend higher and though RBI may keep policy rates on hold in 2018-19, there are also increasing chances of a rate hike. Sentiments remained downbeat, as the government has categorised around 9,500 non-banking financial companies -- about 80 per cent of the NBFCs in the country -- as ‘high risk’ prone as they have not complied with a stipulated provision of the anti-money laundering law. However, the downside remained capped with Commerce & Industry Minister Suresh Prabhu’s statement that India’s stock market has witnessed a compounded annual growth rate (CAGR) of 13 per cent over the last four years, since Prime Minister Narendra Modi assumed office, which demonstrates that investing in the country makes business sense. Separately, Prime Minister Narendra Modi has said that India is one of the most open economies in the world and is ready to do business with the world.

On the global front, European markets were trading in green, as investors monitored the release of economic data and awaited Federal Reserve Chairman Jerome Powell’s highly-anticipated testimony later in the session. However, Asian markets were trading mostly in red. Back home, in scrip specific development, Mahindra & Mahindra (M&M) traded higher after the company and LG Chem, Korea’s leading manufacturer of advanced batteries have entered into collaboration in the field of advanced Li-ion battery technology.

The BSE Sensex is currently trading at 34370.00, down by 75.75 points or 0.22% after trading in a range of 34320.25 and 34610.79. There were 16 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.54%, while Small cap index was down by 0.28%.

The top gaining sectoral indices on the BSE were Telecom up by 0.77%, Consumer Durables up by 0.50%, Energy up by 0.47%, TECK up by 0.18% and IT up by 0.16%, while Realty down by 1.57%, PSU down by 1.27%, Bankex down by 1.13%, Metal down by 0.80% and Basic Materials down by 0.67% were the top losing indices on BSE.

The top gainers on the Sensex were Dr. Reddy’s Lab up by 1.59%, Hero MotoCorp up by 1.09%, Bajaj Auto up by 1.09%, Bharti Airtel up by 1.01% and Reliance Industries up by 0.93%. On the flip side, SBI down by 2.69%, Axis Bank down by 2.05%, ICICI Bank down by 1.96%, Sun Pharma down by 1.90% and HDFC down by 0.97% were the top losers.

Meanwhile, suggesting the banks to invest in long-term assets to improve the capital formation in agriculture sector, Finance minister Arun Jaitley has said that the agriculture credit flow target of Rs 11 lakh crore for 2018-19 is achievable by the banking sector, if they step up agriculture loans.

Jaitley noted that this target would also support the government’s intention to double farmer incomes by 2022 and also reviewed the funds announced in the earlier Union Budgets and expressed need of collaboration of all stakeholders to improve the farmers’ income. He highlighted that investments in financial technology over the past few years have made the rural financial ecosystem efficient, speedy and transparent.

Besides, Department of Financial Services Secretary Rajeev Kumar also stressed on the need of financial inclusion and adoption of technologies to make use of the opportunities arising out of higher GDP growth. He further asked the banking system to concentrate on geographical areas like North East, East, and Central India, where the formal credit can give a fillip to the growth potential these areas offer.

The CNX Nifty is currently trading at 10550.65, down by 31.95 points or 0.30% after trading in a range of 10537.25 and 10631.65. There were 20 stocks advancing against 30 stocks declining on the index.

The top gainers on Nifty were Dr. Reddy’s Lab up by 1.60%, Hero MotoCorp up by 1.26%, NTPC up by 1.04%, Bajaj Auto up by 1.03% and Reliance Industries up by 0.90%. On the flip side, Ambuja Cement down by 4.64%, SBI down by 2.66%, Sun Pharma down by 1.96%, Axis Bank down by 1.96% and ICICI Bank down by 1.94% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 229.94 points or 0.73% to 31,268.66, Shanghai Composite decreased 37.51 points or 1.13% to 3,292.07, Taiwan Weighted decreased 21.23 points or 0.2% to 10,815.47 and KOSPI Index decreased 1.51 points or 0.06% to 2,456.14. On the flip side, FTSE Bursa Malaysia KLCI increased 8.86 points or 0.48% to 1,868.94, Jakarta Composite increased 18.25 points or 0.28% to 6,572.92 and Nikkei 225 increased 236.23 points or 1.07% to 22,389.86.

All European markets were trading in green; Germany’s DAX increased 1.53 points or 0.01% to 12,528.57, France’s CAC increased 13.28 points or 0.25% to 5,357.54 and UK’s FTSE 100 increased 18.71 points or 0.26% to 7,308.29.