Sensex, Nifty trade in red

Indian equity benchmarks were trading in red terrain in late afternoon session, following weak European markets. All the sectoral indices on the BSE except banking were also trading lower, while Yes Bank declined the most with the huge losses of over 12%. Domestic sentiments got hit with SBI Ecowrap report stating that the Reserve Bank of India (RBI) is expected to hike its key lending rate by 25 basis points in October. According to the report, the expected rate hike might not be the last one in the current financial year. Adding some concerns, the World Trade Organization (WTO) said that escalating trade tensions and tighter credit market conditions in important markets would moderate the growth of global merchandise trade to 3.7% in 2019 from 3.9% in 2018. The multilateral trade body also said that trade volume growth should slow to 3.7% in 2019 as global GDP growth dips to 2.9%. Traders failed to take any sense of relief with Finance Minister Arun Jaitley’s statement that the ongoing trade war may have created initial instability, but will gradually open up opportunities for India as a bigger trading and manufacturing base.

On the sectoral front, realty stocks were trading lower, despite a private report showing that Indian real estate market is expected to touch $1 trillion by 2030, becoming the third largest globally. As per the report, the sector is estimated to grow to $650 billion by 2025 and surpass $850 billion by 2028 to touch $1 trillion by 2030. Besides, stocks related to the banking sector also plunged, even though Fitch Ratings’ latest report highlighted that the proposed merger of Bank of Baroda (BoB) with two mid-sized PSU lenders shows the willingness of the government to go ahead with difficult reforms in the banking sector. Fitch also noted that consolidation is likely to be part of the government's strategy to deal with small, weak banks, and should ultimately put the banking system in a better position to support a fast-growing economy. In scrip specific development, Indian Hotels Company surged after the company signed pact with R&R Hotels and Resorts to open a new Vivanta hotel in Kathmandu in Nepal.

On the global front, European markets were trading in red, as Eurozone economic confidence weakened further in September. As per survey data from European Commission, the economic sentiment index dropped to 110.9 in September from 111.6 in August. Sentiments also got hit, after Germany's consumer price inflation accelerated more-than-expected in September to its highest level in nearly seven years. The initial estimates from the Federal Statistical Office showed that the consumer price index rose 2.3% year-on-year following a 2% increase, each in July and August. Asian markets were trading in green, following the overnight gains on Wall Street, with investor sentiment bolstered by the Federal Reserve's positive outlook for the US economy in addition to upbeat US economic data. Besides, Federal Reserve Chairman Jerome Powell said that the US economy does not face a large chance of a recession in the next two years.

The BSE Sensex is currently trading at 36244.54, down by 79.63 points or 0.22% after trading in a range of 36101.10 and 36551.86. 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 1.76%, while Small cap index was down by 3.40%.

The lone gaining sectoral indices on the BSE were Bankex up by 0.02%, while Metal down by 4.35%, Realty down by 4.15%, Telecom down by 3.50%, Basic Materials down by 3.27% and Capital Goods down by 2.60% were the top losing indices on BSE.

The top gainers on the Sensex were HDFC up by 2.14%, HDFC Bank up by 1.67%, Axis Bank up by 1.05%, Wipro up by 1.03% and SBI up by 0.75%. On the flip side, Yes Bank down by 12.75%, Hero MotoCorp down by 5.60%, Tata Steel down by 4.92%, Bharti Airtel down by 4.80% and Bajaj Auto down by 3.17% were the top losers.

Meanwhile, in order to attract more foreign direct investment (FDI), ministry of commerce and industry DIPP joint secretary Rajiv Aggarwal has said that the government will relax FDI regulations to give a boost to the food processing sector. He also underlined that the government is taking efforts to remove bottlenecks existing in the sector.

Aggarwal further mentioned that MNCs and investors were facing some hurdles, which has now been removed in terms of modifications, harmonization, adding that this move may provide ease of doing business in the sector. Besides, he expressed need of technology and investment in supply chain mechanism to boost the industry, highlighting huge wastages being faced by the industry from farm to table.

Rajiv Aggarwal also pointed out the facts and performance of the industry, saying that the country has already received $8.7 billion of FDI in food processing industry and presently, 100 percent FDI in food processing sector is allowed in setting up of manufacturing unit. There is no permission required for wholesale business in the sector too.

The CNX Nifty is currently trading at 10915.60, down by 61.95 points or 0.56% after trading in a range of 10879.05 and 11034.10. There were 11 stocks advancing against 39 stocks declining on the index.

The top gainers on Nifty were HDFC up by 2.20%, HDFC Bank up by 1.79%, Wipro up by 1.50%, Axis Bank up by 0.81% and SBI up by 0.77%. On the flip side, Yes Bank down by 12.82%, Indiabulls Housing Finance down by 8.77%, Hindalco down by 5.72%, Hero MotoCorp down by 5.59% and Tata Steel down by 5.17% were the top losers.

Asian markets were trading mostly in green; Shanghai Composite increased 29.58 points or 1.05% to 2,821.35, Nikkei 225 jumped 323.30 points or 1.34% to 24,120.04, Straits Times rose 11.90 points or 0.37% to 3,248.16, Hang Seng gained 72.85 points or 0.26% to 27,788.52 and Jakarta Composite was up by 29.01 points or 0.49% to 5,958.23. On the flip side, KOSPI decreased 12.36 points or 0.53% to 2,343.07 and Taiwan Weighted was down by 27.85 points or 0.25% to 11,006.34.

All European markets were trading in red; UK’s FTSE 100 lost 1.35 points or 0.02% to 7,544.09, France’s CAC fell 17.92 points or 0.32% to 5,522.49 and Germany’s DAX was down by 80.90 points or 0.65% to 12,354.69.