Local equities continue to trade flat with negative bias

Local equities continue to trade flat with negative bias in afternoon session with Nifty and Sensex posting losses of around 10 and 32 points, respectively due to selling in Metal, Telecom and Healthcare stocks. The sentiments got spoiled after India Ratings and Research stated that India is set to miss its fiscal deficit target for the year ending March 2019 due to a shortfall in revenues and lower-than-targeted disinvestment proceeds. Further, State Bank of India (SBI) has estimated the country’s economy to expand by 7.5-7.6 per cent, slower than the prior quarter, mainly on account of a slowdown in rural demand. However, losses were restricted as some support came with a private report stating that the persisting concerns in the government over a liquidity squeeze in the non-bank lenders (NBFC) segment and its adverse effect on the financing of small businesses, the Reserve Bank of India on Monday announced further easing of the hedging norms for external commercial borrowings (ECBs). Meanwhile, a private report stated that India recorded the highest average real wage growth in South Asia during 2008-17.

On the global front, Asian markets were trading mixed, as dealers focused on crunch G20 talks between Donald Trump and Xi Jinping, with the US president warning he will ramp up his trade war with China if the two do not reach a deal. Back home, in scrip specific development, Uday Jewellery Industries gained on planning to take up premises on lease. Besides, 63 moons technologies jumped on executing SPA with NTT Data Corporation.

The BSE Sensex is currently trading at 35322.58, down by 31.50 points or 0.09% after trading in a range of 35264.19 and 35424.27. There were 13 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.01%, while Small cap index was up by 0.28%.

The top gaining sectoral indices on the BSE were Realty up by 1.20%, IT up by 0.82%, Energy up by 0.74%, Power up by 0.60% and TECK was up by 0.57%, while Metal down by 2.38%, Telecom down by 0.98%, Healthcare down by 0.92%, Basic Materials down by 0.88% and FMCG was down by 0.43% were the losing indices on BSE.

The top gainers on the Sensex were Infosys up by 1.82%, Power Grid up by 1.16%, Reliance Industries up by 1.06%, NTPC up by 0.69% and Maruti Suzuki was up by 0.64%. On the flip side, Sun Pharma down by 4.73%, Tata Steel down by 2.85%, Bajaj Auto down by 2.41%, Vedanta down by 2.37% and Bharti Airtel was down by 2.02% were the top losers.

Meanwhile, India Ratings and Research in its latest report has said that India is set to miss its fiscal deficit target for the current financial (FY19) on account of a shortfall in revenues and lower-than-targeted disinvestment proceeds. The rating agency has estimated fiscal deficit at Rs 6.67 trillion or 3.5 percent of GDP for current fiscal. For FY19, the country fiscal deficit target has been pegged at 3.3 percent of its gross domestic product (GDP) or Rs 6.24 trillion ($88.45 billion).

It highlighted that the pressure on government finances is mainly arising from the revenue side, particularly from indirect taxes and non-tax revenue. Moreover, it stated that despite the reforms helping plug leakages in GST collections, aggregate indirect tax collections grew only 4.3 percent in the first half of the year compared with a targeted growth of 22.2 percent for the full year.

India's GST collection for last financial year (FY18) was 98 percent of the budgeted target. Besides, it said that the government is also expected to miss its disinvestment target of Rs 800 billion in 2019, given that it had received only Rs 152.47 billion till the end of October.

The CNX Nifty is currently trading at 10618.65, down by 9.95 points or 0.09% after trading in a range of 10596.35 and 10641.40. There were 22 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were Infosys up by 2.01%, Bajaj Finserv up by 1.83%, Indian Oil Corporation up by 1.35%, HCL Tech up by 1.28% and BPCL was up by 1.10%. On the flip side, JSW Steel down by 5.31%, Sun Pharma down by 4.78%, Tata Steel down by 2.83%, Vedanta down by 2.60% and Hero MotoCorp was down by 2.48% were the top losers.

Asian markets were trading mixed; Jakarta Composite gained 8.06 points or 0.13% to 6,030.84, KOSPI jumped 16.40 points or 0.78% to 2,099.42, Nikkei 225 surged 140.40 points or 0.64% to 21,952.40 and Taiwan Weighted was up by 13.26 points or 0.14% to 9,778.62.

On the flip side; Hang Seng declined 71.40 points or 0.27% to 26,304.78, Straits Times dropped 2.24 points or 0.07% to 3,091.14 and Shanghai Composite was down by 6.11 points or 0.24% to 2,569.70.