Sensex, Nifty continue lackluster trade

Indian equity markets continued their lackluster trade in late afternoon session, tracking weak opening in European counterparts. However, broader indices perform better than larger peers, with BSE mid cap and small cap gaining around half a percent. Traders remained cautious with a private report stating that slowdown in Non-Banking Financial Companies (NBFC) disbursements could have a negative impact on growth. It also said if this situation persists there will be a negative impact on growth because credit availability is going to be that much reduced for the aggregate economy. Pessimism also persisted with Moody’s Investors Service’s statement that Indian economy will expand 7.4% in 2018, but the growth will slow down to 7.3% in the next year as domestic demand tapers on higher borrowing cost due to rising interest rates. Traders failed to take any sense of relief with another private report stating that Indian retail inflation likely slowed to its slowest pace in 12-months in October after food and fuel costs fell, keeping the official consumer prices gauge below the central bank's medium-term target for a third consecutive month.

On the global front, European markets were trading in red as they continued to chase global market sentiments. Besides, worries about a slowdown in China and concerns over Italy's budget deficit weighted on market sentiments. Asian markets were trading mostly lower after the Federal Reserve left rates unchanged but signaled further gradual increases in rates despite signs of a slowdown in the pace of growth in business investment. Back home, the government said it is not seeking Rs 3.6 trillion capital from the Reserve Bank of India, but is only in the discussion for fixing appropriate economic capital framework of the central bank.

The BSE Sensex is currently trading at 35147.34, down by 90.34 points or 0.26% after trading in a range of 35011.23 and 35287.29. There were 16 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.62%, while Small cap index was up by 0.47%.

The top gaining sectoral indices on the BSE were Healthcare up by 1.14%, Consumer Disc up by 0.78%, Consumer Durables up by 0.68%, Auto up by 0.58% and Power was up by 0.46%, while IT down by 1.27%, TECK down by 1.20%, Metal down by 1.07%, Telecom down by 1.03% and Energy was down by 0.80% were the top losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 4.26%, Asian Paints up by 3.57%, Sun Pharma up by 3.00%, Adani Ports & SEZ up by 2.30% and Hero MotoCorp was up by 2.03%. On the flip side, Bharti Airtel down by 2.76%, Infosys down by 2.12%, Reliance Industries down by 1.85%, TCS down by 1.66% and Tata Steel was down by 1.48% were the top losers.

Meanwhile, two year after demonetisation of Rs 500 and Rs 1000 currency notes, Finance Minister Arun Jaitley has said that the note ban is one of the important decisions taken by the government to formalise the economy. The minister also highlighted the aim and positive impacts of the move.

Finance Minister underlined that confiscation of currency was not an objective of demonetisation but the actual aim was getting it into the formal economy and making the holders pay tax. Besides, he said that income tax collections and tax returns filings also increased on the back of noteban. Adding further he said that a lot of this money was diverted to the mutual funds for further investments and it became a part of the formal system.

Further, Jaitley pointed out that the demonetisation also helped to spur digitisation in the country, giving the transactions details of Unified Payment Interface (UPI) and Bharat Interface for Money (BHIM). The UPI transactions grew from Rs 50 crore in October 2016 to Rs 59,800 crore in September this year, while the value of BHIM transactions went up from Rs 2 crore in September 2016 to Rs 7,060 crore in September this year.

The CNX Nifty is currently trading at 10583.30, down by 15.10 points or 0.14% after trading in a range of 10544.85 and 10619.55. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Yes Bank up by 5.30%, HPCL up by 4.94%, Asian Paints up by 3.63%, Sun Pharma up by 3.03% and BPCL was up by 2.84%. On the flip side, Bharti Airtel down by 2.69%, GAIL India down by 2.40%, Dr. Reddy’s Lab down by 2.35%, Infosys down by 2.30% and Hindalco was down by 1.91% were the top losers.

All the Asian markets were trading in red; KOSPI fell 6.54 points or 0.31% to 2,086.09, Nikkei 225 slipped 236.67 points or 1.06% to 22,250.25, Jakarta Composite declined 102.66 points or 1.75% to 5,874.15, Hang Seng lost 625.80 points or 2.44% to 25,601.92, Shanghai Composite dropped 36.76 points or 1.41% to 2,598.87, Straits Times decreased 15.27 points or 0.5% to 3,077.97 and Taiwan Weighted was down by 115.30 points or 1.17% to 9,830.01.

All the European markets were trading in red; UK’s FTSE 100 fell 33.09 points or 0.47% to 7,107.59, France’s CAC decreased 34.78 points or 0.68% to 5,096.67 and Germany’s DAX was down by 65.64 points or 0.57% to 11,461.68.