Sensex, Nifty trim losses but continue to trade in red

Indian equities trimmed most of their losses but continued to trade in red in the afternoon session, as caution set in ahead of RBI monetary policy meet scheduled to begin today. Investors’ sentiment remain weak with a report that India’s core sector output grew at a slower pace of 4.2% in August 2018, from 7.3% in July 2018, as output of coal, refinery products and fertilisers moderated. Moreover, rupee’s fell below the 73-mark against the dollar along with a weak trend at other Asian markets too dampened investors’ sentiments. However, the markets managed to pare most of their losses with the finance ministry expecting the GST collections to cross Rs 1 lakh crore in November and December on account of festive season demand and the anti-evasion measures initiated by the revenue department. Besides, the country's microfinance sector which rose by 25 per cent in the first quarter, may need Rs 6,000-9,000 crore over the next three years to meet it growth plans.

On the global front, Asian markets were trading mostly in red, as Italy's mounting debt and Rome's budget plan set it on a collision course with the European Union. Back home, the BSE Sensex is currently trading at 36411.80, down by 114.34 points or 0.31% after trading in a range of 36200.99 and 36602.85. There were 17 stocks advancing against 14 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index down by 0.40%, while Small cap index was up by 0.85%.

The top gaining sectoral indices on the BSE were Metal up by 2.05%, PSU up by 1.09%, Oil & Gas up by 0.95%, Capital Goods up by 0.84% and Industrials was up by 0.64%, while Telecom down by 1.78%, Auto down by 1.47%, TECK down by 1.41%, IT down by 1.27% and Consumer Disc was down by 0.96% were the top losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 7.50%, Vedanta up by 4.98%, ONGC up by 1.42%, Tata Steel up by 1.21% and Coal India up by 1.16%. On the flip side, Mahindra & Mahindra down by 3.83%, TCS down by 2.75%, Maruti Suzuki down by 2.08%, Axis Bank down by 2.01% and Indusind Bank down by 1.73% were the top losers.

Meanwhile, the Confederation of Indian Industry (CII) has said that the fall in the value of rupee does not benefit exporters, instead, a stable range-bound currency is needed for long term sustainable growth of India's international trade. It also said that in the present globalised environment, majority of costs like raw material, shipping charges, warehousing and other related services are denominated in foreign currency or at import parity price.

According to the chamber, most of exporters do long term hedging at the time of booking of orders, while importers press for reduction in prices citing depreciation of rupee. Hence, Chairman of CII National Committee on Exports and Imports Sanjay Budhia has said that it is more of a perception than reality that fall of Rupee helps exporters. He pointed out that what is required is a stable range-bound currency which will give stability and certainty for quoting prices and accepting orders in today's competitive global environment.

Recently, the rupee has taken a beating amid volatility in global markets and strengthening of the greenback. The central bank has been taking various measures to shore up the rupee.

The CNX Nifty is currently trading at 10971.55, down by 36.75 points or 0.33% after trading in a range of 10900.40 and 10989.05. There were 24 stocks advancing against 26 stocks declining on the index.

The top gainers on Nifty were Yes Bank up by 7.84%, Vedanta up by 4.73%, HPCL up by 3.64%, Bajaj Finance up by 3.36% and Indiabulls Housing Finance up by 2.64%. On the flip side, Bharti Infratel down by 5.10%, Eicher Motors down by 5.09%, Mahindra & Mahindra down by 3.79%, UPL down by 3.09% and Grasim Industries down by 3.00% were the top losers.

Asian markets were trading mostly in red, Nikkei 225 decreased 159.66 points or 0.66% to 24,110.96, Hang Seng fell 58.30 points or 0.22% to 27,068.08, Taiwan Weighted dropped 55.69 points or 0.51% to 10,863.94, Jakarta Composite was down by 18.53 points or 0.32% to 5,857.09 and KOSPI dipped 29.31 points or 1.27% to 2,309.57.

On the flip side, Straits Times rose 27.83 points or 0.85% to 3,270.48.