Sensex, Nifty continue southward journey

Indian equity benchmarks added losses and continued their southward journey in late afternoon session, with Sensex and Nifty falling 230 and 88 points, respectively, despite firm opening in European markets. Heavy selling in Healthcare and Realty sectors along with losses led by industry majors like Dr. Reddy’s Lab, Sun Pharma and Tata Motors were dragging the markets down. Some concerns came with a private report stating that Corporate India-especially the chunk comprising over-leveraged companies-is worried about a recent Reserve Bank of India (RBI) circular that says companies with even a day of loan-default can be set on the path of debt resolution and subsequent bankruptcy proceedings. Adding some worries, Niti Aayog CEO Amitabh Kant said that achieving 9-10% growth rate in the next 30 years would be a challenge for India, even though the country is expanding at 7.5% growth rate per annum. Anxiety also spread among traders with the Comptroller and Auditor General (CAG) of India Rajiv Mehrishi’s statement that the root cause of Indian banking sector crisis is the problem in the bond market as the Reserve Bank of India (RBI) acts as regulator as well as trader. He noted that the RBI, in its effort to ensure that banks don’t fail, has slowed down giving licences to new banks, so it promotes uncompetitive behavior. In line with the larger peers, the broader markets too continued lackluster trade in late noon deals. Meanwhile, credit information company Transunion Cibil in its latest report has said that even after the increased focus on retail lending for a decade, banks and other lending institutions have been able to tap only into a third of the estimated 220 million credit-eligible consumers.

On the global front, European markets were trading in green, after the US and China agreed to set up a framework for addressing trade imbalances in the future, helping ease fears of a looming trade war. Asian markets were also trading in green. Back home, in scrip specific development, Atishay gained on bagging order worth Rs 2.40 crore from RajComp lnfo Services (RISL), Government of Raiasthan, to develop an Engine for Document Verification and Authentication with defined set of procedures that will be used by the various departments for Government of Raiasthan.

The BSE Sensex is currently trading at 34618.09, down by 230.21 points or 0.66% after trading in a range of 34617.91 and 34973.95. There were 10 stocks advancing against 21 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 1.56%, while Small cap index was down by 2.19%.

The few gaining sectoral indices on the BSE were PSU up by 0.37%, IT up by 0.26%, TECK up by 0.18% and Telecom up by 0.13%, while Healthcare down by 2.39%, Realty down by 2.09%, Basic Materials down by 2.06%, Industrials down by 1.91% and Consumer Durables down by 1.88% were the top losing indices on BSE.

The top gainers on the Sensex were SBI up by 1.90%, TCS up by 1.86%, Coal India up by 1.35%, ONGC up by 1.00% and ICICI Bank up by 0.75%. On the flip side, Dr. Reddy’s Lab down by 3.77%, Sun Pharma down by 3.60%, Tata Motors down by 3.13%, Tata Motors - DVR down by 2.91% and Yes Bank down by 2.88% were the top losers.

Meanwhile, Niti Aayog CEO Amitabh Kant has said that achieving 9-10% growth rate in the next 30 years would be a challenge for India, even though the country is expanding at 7.5% growth rate per annum.

Highlighting the Indian Start-Up ecosystem, Kant said that the country has created one of the finest startup ecosystems in the world and these ventures are doing extremely well. He added that startups from Silicon Valley and Singapore are relocating to India. He also termed India as a billion plus market and urged investors to utilise their funds more effectively by investing in India.

Niti Aayog CEO also underlined ongoing demographic transition of the country as 72% of its population is young and the population will keep growing younger. Besides, beating all the estimates, India’s third quarter Gross Domestic Product (GDP) growth numbers grew at a rate of 7.2% as against growth of 6.5% in the previous quarter. Besides, full FY18 GDP growth is pegged at 6.6% against 6.5% a year ago.

The CNX Nifty is currently trading at 10507.90, down by 88.50 points or 0.84% after trading in a range of 10507.85 and 10621.70. There were 14 stocks advancing against 36 stocks declining on the index.

The top gainers on Nifty were SBI up by 2.14%, TCS up by 1.80%, Bharti Infratel up by 1.69%, BPCL up by 1.62% and Coal India up by 1.22%. On the flip side, Dr. Reddy’s Lab down by 4.29%, Sun Pharma down by 3.91%, UPL down by 3.66%, Vedanta down by 3.39% and Yes Bank down by 3.10% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 0.5 points or 0.03% to 1,855.00, KOSPI Index increased 4.92 points or 0.2% to 2,465.57, Shanghai Composite increased 20.54 points or 0.64% to 3,213.84, Nikkei 225 increased 72.01 points or 0.31% to 23,002.37, Taiwan Weighted increased 135.36 points or 1.25% to 10,966.20 and Hang Seng increased 186.44 points or 0.6% to 31,234.35. On the flip side, Jakarta Composite decreased 39.7 points or 0.69% to 5,743.61.

European markets were trading mostly in green; France’s CAC increased 32.72 points or 0.58% to 5,647.23 and UK’s FTSE 100 increased 51.47 points or 0.66% to 7,830.26. On the flip side, Germany’s DAX decreased 36.89 points or 0.28% to 13,077.72.