Indian bourses continue to trade under pressure

Indian bourses remained under heavy selling pressure in afternoon session, following a crash in global markets. The mood of the markets remained impacted with a private report stating that private equity and venture capital (PE/VC) investments in India declined 23% to $6.7 billion in the third quarter of this year as investors adopted a cautious approach. On a year to date basis however, PE/VC investments in India are higher by 17.4% and the investment tally also looks set to surpass the previous year high driven by some large deals in the pipeline, provided there is no major macro setback. The key indices also suffered due a sinking rupee which slipped to a new record low of 74.50 against the US dollar so far in intra-day trade. Some caution also prevailed in the markets ahead of key economic data for August IIP and September CPI. However, the markets trimmed some of their losses, as traders found some support with International Monetary Fund (IMF) report that India’s debt is lower than the best or emerging market economies in the world, India’s debt was substantially less than the global debt as percentage of world Gross Domestic Product (GDP). On the sectoral front, insurance sector remained in focus with the Insurance Regulatory and Development Authority of India (IRDAI) is in the favour of allowing 100 percent foreign direct investment (FDI) in insurance intermediaries in addition to insurance brokers.

On the global front, Asian markets were trading in red, as Wall Street equities and bonds slumped over the impact of rising interest rates. Back home, the BSE Sensex is currently trading at 34103.32, down by 657.57 points or 1.89% after trading in a range of 33723.53 and 34125.71. There were 2 stocks advancing against 29 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 1.18%, while Small cap index was down by 1.03%.

The only gaining sectoral index on the BSE was Oil & Gas up by 0.62%, while Metal down by 2.62%, IT down by 2.52%, Realty down by 2.36%, Basic Materials down by 2.31% and TECK down by 2.14% were the top losing indices on BSE.

The only gainers on the Sensex were Yes Bank up by 6.05% and ONGC up by 1.48%. On the flip side, SBI down by 5.03%, Tata Steel down by 4.40%, Infosys down by 2.68%, Mahindra & Mahindra down by 2.57% and Indusind Bank down by 2.50% were the top losers.

Meanwhile, India’s draft National Policy on Electronics (NPE) released by the Ministry of Electronics and Information Technology (MeitY) has set an ambitious target of creating a $400 billion electronics manufacturing industry by the year 2025, with mobile devices segment accounting for three-fourths of the production. The proposed policy aims to double target of mobile phone production from 500 million units in 2019 to 1 billion by 2025 to meet the objective.

According to the draft electronics policy, the $400 billion turnover shall include targeted production of 1 Billion mobile handsets by 2025, valued at $190 billion (approximately Rs 13 lakh crore), including 600 Million mobile handsets valued at $110 Billion (approximately Rs 7 lakh crore) for export. It also noted that the government plans to end modified special incentive scheme with with schemes that it will find easier to implement such as interest subsidy and credit default guarantee etc.

The draft further indicated that 265 applications with proposed investment of Rs 61,925 crore have been received under M-SIPS as on September 30, 2018, out of which 188 applications with proposed investment of Rs 40,922 crore have been approved and the investment of Rs 8,335 crore has been made by 139 applicants. The policy proposes to push development of core competencies in all the sub-sectors of electronics including electronic components and semiconductors, defence electronics, automotive electronics, industrial electronics, strategic Electronics etc.

The CNX Nifty is currently trading at 10274.25, down by 185.85 points or 1.78% after trading in a range of 10138.60 and 10274.50. There were 9 stocks advancing against 41 stocks declining on the index.

The top gainers on Nifty were Yes Bank up by 6.76%, HPCL up by 5.31%, Zee Entertainment up by 2.63%, Indian Oil Corp. up by 1.61% and ONGC up by 1.55%. On the flip side, Indiabulls Housing Finance down by 6.24%, SBI down by 5.38%, Tata Steel down by 4.27%, Bajaj Finserv down by 4.07% and Grasim Industries down by 3.80% were the top losers.

Asian markets were trading in red; Nikkei 225 shed 915.18 points or 4.05% to 22,590.86, KOSPI fell 98.94 points or 4.65% to 2,129.67, Straits Times dipped 87.24 points or 2.87% to 3,044.24, Shanghai Composite decreased 163.09 points or 6.36% to 2,562.75, Hang Seng dropped 996.93 points or 3.96% to 25,196.14, Taiwan Weighted decreased 660.72 points or 6.74% to 9,806.11 and Jakarta Composite was down by 103.06 points or 1.8% to 5,717.61.