Indian markets continue to trade in red zone

Indian bourses continued their weak trade in early noon session, owing to selling pressure in frontline blue-chip counters. Kotak Mahindra Bank, Reliance Industries, Sun Pharm and Asian Paints were the prime losers among heavy-weights. Weaken rupee, crude oil price rise, escalation in US-China trade tensions also dampened the sentiment. Market participants paid no heed to RBI’s weekly statistical supplement showing that India’s foreign exchange (forex) reserves rose by $932.8 million during the week ended November 30. Meanwhile, Indian inflation is likely to have cooled to a 16-month low in November as food and fuel prices fell, supporting the Reserve Bank of India’s decision to keep interest rates on hold at a policy meeting last week. Besides, IMF Chief Economist has said that it is important for the Indian government to heed the RBI's message on financial stability, amidst reports of friction between the central bank and the Finance Ministry. Diamond Cutting and Jewellery & Precious Metals stocks are in focus with a private report stating India’s gem and jewellery exports, which witnessed a decline of 4.35% in dollar terms during April-October, may post a recovery in the remaining five months of the current fiscal year, as the improved macroeconomic conditions in the US.

On the global front, Asian markets were trading in red on worries over slowing growth and fears that a fresh flare-up in tensions between Washington and Beijing could quash any chances of a trade deal. Back home, in stock specific movement, Maruti Suzuki gained on achieving five lakh cumulative CNG vehicle sales. Besides, Vikas WSP advanced on bagging orders worth Rs 243.09 crore.

The BSE Sensex is currently trading at 35121.79, down by 551.46 points or 1.55% after trading in a range of 35016.08 and 35246.97. 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 1.56%, while Small cap index was down by 1.62%.

The top losing sectoral indices on the BSE were Realty down by 2.72%, Energy down by 2.58%, Power down by 2.07%, Telecom down by 2.05% and Utilities was down by 1.99%, while there were no gainers on the BSE sectoral front.

The top gainers on the Sensex were Maruti Suzuki up by 0.51% and Mahindra & Mahindra was up by 0.40%. On the flip side, Kotak Mahindra Bank down by 4.69%, Reliance Industries down by 3.99%, Sun Pharma down by 2.93%, Adani Ports &Special down by 2.82% and Asian Paints was down by 2.49% were the top losers.

Meanwhile, Praising the fundamental economic reforms like the Goods and Services Tax (GST) and the Insolvency and Bankruptcy Code (IBC) carried out by the government, International Monetary Fund’s (IMF) Chief Economist Maurice Obstfeld has said that India’s growth performance has been ‘very solid’ over the past four years.

Obstfeld added ‘There are important vulnerabilities, so it is important for the reform momentum to be maintained even as an election comes up and for the path of fiscal adjustment to be maintained’. He said one risk that has become much more evident in the last few years has been non-bank finance, usually called shadow banking. He also said there is a big challenge of stricter, oversight.

Noting that there has long been a legacy of corporate debt associated with bad infrastructure projects in India, he said it has been very concentrated in banking system. He said ‘But as the government is trying to better oversee the banking system, these loans have migrated to shadow banking and that is an area where more needs to be done to contain financial pressures, which we are beginning to see in India’.

The CNX Nifty is currently trading at 10527.60, down by 166.10 points or 1.55% after trading in a range of 10486.00 and 10558.85. There were 6 stocks advancing against 44 stocks declining on the index.

The top gainers on Nifty were Indian Oil Corporation up by 2.43%, HPCL up by 1.29%, BPCL up by 0.92%, Maruti Suzuki up by 0.53% and Mahindra & Mahindra was up by 0.43%. On the flip side, Kotak Mahindra Bank down by 4.43%, Reliance Industries down by 4.00%, Ultratech Cement down by 3.74%, Indiabulls Housing down by 3.67% and Bajaj Finserv was down by 3.62% were the top losers.

All the Asian markets are trading in red; Nikkei 225 tumbled 437.58 points or 2.02% to 21,241.10, Straits Times declined 39.50 points or 1.27% to 3,071.62, Hang Seng dropped 372.51 points or 1.43% to 25,691.25, Taiwan Weighted fell 113.34 points or 1.16% to 9,647.54, KOSPI shed 25.47 Points or 1.23% to 2,050.29, Jakarta Composite slipped 29.41 points or 0.48% to 6,096.95 and Shanghai Composite was down by 25.46 points or 0.98% to 2,580.43.