Key Indian equity benchmarks continued their lackluster trade in late morning session, amid weak Asian markets. Traders remained concerned, with the report that India's fiscal deficit touched Rs 6.77 lakh crore at the end of January, 113.7 per cent of the target for the entire fiscal, on account of higher expenditure. Domestic sentiments were downbeat, as Former RBI governor D Subbarao cautioned against India’s deficit challenge and said the country is no longer the sweet spot due to rising oil prices. He also said raising of import tariff in the Union Budget 2018-19 will hurt Make in India mission. However, the downside remained capped as investors took some relief with the report that Indian economy grew at five-quarter high of 7.2% in the October-December period of the fiscal year 2017-18 (FY18), as against 6.5% in the previous quarter and 6.8% in the same period last year, on the back of a sharp pickup in the services sector, a rebound in industrial activity, especially manufacturing and construction, and an expansion in agriculture. Some solace also came with the report that India’s core sector output expanded at a faster pace of 6.7% in January 2018, against the 4.2% growth recorded in December 2017, as petroleum refinery and cement output zoomed while steel power and coal production improved.
On the global front, Asian markets were trading mixed, after US stocks extended losses overnight on concerns over interest rates and as crude oil prices fell. Investors were also cautious as Federal Reserve Chairman Jerome Powell is due to testify before the Senate Banking Committee later on Thursday. Back home, in scrip specific development, NCC was trading in green after the company received 7 new orders totalling to Rs 2,980 crore in the month of February, 2018.
The BSE Sensex is currently trading at 34104.25, down by 79.79 points or 0.23% after trading in a range of 34080.61 and 34278.63. There were 15 stocks advancing against 16 stocks declining on the index.
The broader indices were trading mixed; the BSE Mid cap index was down by 0.13%, while Small cap index was up by 0.26%.
The top gaining sectoral indices on the BSE were Telecom up by 0.62%, Industrials up by 0.28%, Capital Goods up by 0.27%, Auto up by 0.24% and Oil & Gas up by 0.23%, while Power down by 0.46%, Utilities down by 0.45%, IT down by 0.41%, TECK down by 0.29% and Bankex down by 0.28% were the top losing indices on BSE.
The top gainers on the Sensex were Bharti Airtel up by 1.76%, Tata Motors up by 1.03%, Bajaj Auto up by 0.70%, Tata Motors - DVR up by 0.60% and Mahindra & Mahindra up by 0.58%. On the flip side, ICICI Bank down by 1.91%, Power Grid Corporation down by 1.21%, Infosys down by 1.18%, SBI down by 1.13% and Adani Ports & SEZ down by 0.73% were the top losers.
Meanwhile, cautioning against India’s deficit challenge, former Reserve Bank of India (RBI) governor D Subbarao has stated that the country is no longer the sweet spot, largely due to steadily increasing oil prices. He pointed out that it is therefore worrying that Finance Minister Arun Jaitley has loosened up on fiscal consolidation in the Union Budget 2018-19 in the face of a rising current account deficit. He added that the country's balance of payments crisis in 1991 and the near crisis in 2013 were consequences of unchecked fiscal profligacy spilling over into the external sector.
Subbarao has said that raising customs duty on a range of products in the Budget will hurt government’s Make in India mission. He noted that this decision was ill advised also because it runs counter to the calibrated reduction in import tariffs over two decades, and is also in conflict with Prime Minister Narendra Modi's speech in Davos where he decried the growing protectionist tendencies in the rich world. He added that not walking the talk raises a credibility gap, which will hurt India's investment prospects.
Citing Indo-China trade, Former RBI governor indicated that during 2001-16, India's trade deficit with China shot up from nearly $1 billion to over $50 billion, and the tilt is a result of the latter's mercantilist policies. He also mentioned that during this period, the rupee actually depreciated against the yuan by as much as 70 per cent which, if anything, should have given India an advantage. He said that globalisation has never been a totally benign experience, it offers immense opportunities, but also poses ruthless challenges. He added that the task for India, as it is for every country, is to maximise the benefits and minimise the costs of integrating with the world.
The CNX Nifty is currently trading at 10479.95, down by 12.90 points or 0.12% after trading in a range of 10470.65 and 10525.50. There were 27 stocks advancing against 23 stocks declining on the index.
The top gainers on Nifty were BPCL up by 2.68%, Aurobindo Pharma up by 1.77%, Bharti Airtel up by 1.54%, Ambuja Cement up by 1.21% and Tata Motors up by 1.05%. On the flip side, ICICI Bank down by 1.63%, Hindalco down by 1.24%, Lupin down by 1.12%, Infosys down by 1.05% and SBI down by 0.91% were the top losers.
Asian markets were trading mixed; Nikkei 225 decreased 407.21 points or 1.85% to 21,661.03, Hang Seng decreased 125.36 points or 0.41% to 30,719.36 and Taiwan Weighted decreased 29.68 points or 0.27% to 10,785.79.
On the flip side, FTSE Bursa Malaysia KLCI increased 3.22 points or 0.17% to 1,859.42, Shanghai Composite increased 3.67 points or 0.11% to 3,263.08 and Jakarta Composite increased 25.84 points or 0.39% to 6,623.05.
