Bears hold tight grip on markets

Bears were holding tight grip on the markets in afternoon session, with Sensex and Nifty crumbling under pressure. Both the key indices were falling around a percent, on the back of continuous selling in almost all the sectors except IT. A sharp fall in broader markets along with losses led by major industry losers like Vedanta and Bharti Airtel, also kept the markets down in afternoon deals. Anxiety also spread among the traders, after the Income Tax Department (ITD) launched multiple raids at over 100 locations in Tamil Nadu and Andhra Pradesh as part of a tax evasion probe against mining and mineral export companies. Domestic sentiments got hit with a private report stating that exchange rate movements increase the vulnerability of firms from emerging market economies, including India, which have used the proceeds of dollar bond to fund financial assets. Traders failed to take any sense of relief with Economic Affairs Secretary Subhash Chandra Garg’s statement that the non-banking financial companies' (NBFCs) liquidity, rupee fall are temporary problems. He also noted that the government is conscious of liquidity problem but is not worried because these are temporary and would more look at taking steps to resolve these problems.

On the sectoral front, agri stocks remained in lime limelight, after Vice President M Venkaiah Naidu said that farmers should be provided new technology to make farming more sustainable and viable as boosting agriculture is one of the top priorities of the government, while stocks related to the pharma companies were also remained in focus, with the Competition Commission of India (CCI) policy note stating that unreasonably high trade margins contributes towards high drug prices and electronic trading of drugs could be an option to spur competitive pricing ways.

On the global front, Asian markets were trading in red, following the overnight sell off on Wall Street amid disappointing corporate earnings results and weak economic data. Worries about geopolitical tensions, trade wars and global economic growth also dampened investor sentiments.

The BSE Sensex is currently trading at 33693.11, down by 340.85 points or 1.00% after trading in a range of 33553.18 and 33807.93. There were 8 stocks advancing against 23 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 1.17%, while Small cap index was down by 1.46%.

The lone gaining sectoral index on the BSE was IT up by 0.19%, while Realty down by 3.01%, Metal down by 2.36%, Telecom down by 2.22%, Basic Materials down by 2.00% and Industrials down by 1.54% were the top losing indices on BSE.

The top gainers on the Sensex were Wipro up by 2.86%, TCS up by 0.74%, ONGC up by 0.54%, Mahindra & Mahindra up by 0.53% and Kotak Mahindra Bank up by 0.51%. On the flip side, Vedanta down by 4.27%, Bharti Airtel down by 4.12%, Adani Ports & SEZ down by 4.02%, ICICI Bank down by 2.89% and Tata Motors down by 2.46% were the top losers.

Meanwhile, India will not impose anti-dumping duty on imports of a chemical, used in the pharma industry, from China, Germany and Saudi Arabia as the commerce ministry's investigation arm the Directorate General of Trade Remedies (DGTR) found no impact of its increased imports on the local industry. The DGTR, in its final findings, concluded that the domestic industry is not suffering injury on account of the imports of 'Di Methyl Formamide' from these three regions.

The DGTR has said that the authority is of the view that imposition of anti-dumping duty is not warranted in the present investigation. It also said that the directorate considers it appropriate to not recommend antidumping duty. Balaji Amines had filed an application for the imposition of anti-dumping duty on the imports from the three countries. The chemical is used as a solvent in pharmaceuticals manufacturing, polymers making and pesticides formulations.

The DGTR also stated that the large volume of imports are in response to the increased demand in the country and are not directly impacting the domestic industry. It pointed out that there is an overall improvement in the health of the domestic industry. It noted that the production from the base year (2014-15) to subsequent years have multiplied manifold and during the period of investigation has reached 10 times of the production of the base year. It added that the sales of domestic industry have also shown a multifold increase.

The CNX Nifty is currently trading at 10120.80, down by 103.95 points or 1.02% after trading in a range of 10079.30 and 10159.55. There were 11 stocks advancing against 39 stocks declining on the index.

The top gainers on Nifty were Wipro up by 2.82%, TCS up by 0.97%, HCL Tech. up by 0.69%, Asian Paints up by 0.47% and Kotak Mahindra Bank up by 0.47%. On the flip side, Indiabulls Housing Finance down by 6.40%, Vedanta down by 4.37%, Hindalco down by 4.09%, Adani Ports & SEZ down by 4.01% and Bharti Airtel down by 3.88% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 declined 822.45 points or 3.87% to 21,268.73, Straits Times dropped 35.57 points or 1.19% to 2,996.51, Taiwan Weighted plunged 238.61 points or 2.51% to 9,520.79, Hang Seng lost 388.76 points or 1.56% to 24,861.02 and KOSPI fell 34.28 points or 1.66% to 2,063.30. On the flip side, Shanghai Composite increased 1.49 points or 0.06% to 2,604.79 and Jakarta Composite was up by 30.05 points or 0.52% to 5,739.47.