Local equities continue weak trade in morning deals

Local equity benchmarks continued their weak trade in the morning on account of selling in frontline counters. A level of pressure was seen on frontline stocks, especially Infosys, Adani Ports and Wipro. Market participants remained concerned with former RBI Governor Raghuram Rajan cautioning that transfer of excess reserve to the government may bring down rating of the central bank. Rating downgrade of the RBI from ‘AAA’ would make borrowing costlier for the central bank and will have implication for the entire economy. Traders also remained cautions with S&P Global Ratings’ report stating that the increasing involvement of the government in the affairs of the RBI could undermine the hard-fought improvements in the banking system over the past few years. Besides, public debt accounted for nearly 90% of the government’s total liabilities, which ballooned to Rs 82.03 lakh crore at the end of September quarter.

On the global front, Asian markets were trading in red, following a sharp retreat on Wall Street fuelled by increasing worries about the global economy, while investors await the Federal Reserve policy meeting this week. Back home, the Commerce and Industry Ministry is working on a new e-commerce policy to boost the fast growing online retail as well as protect the interest of small retailers. The government has already set up a group of secretaries to look into the issues of the sector.

The BSE Sensex is currently trading at 36062.29, down by 207.78 points or 0.57% after trading in a range of 36046.52 and 36226.38. There were 9 stocks advancing against 20 stocks declining, while 2 stocks remain unchanged on the index.

The broader indices were trading mixed; the BSE Mid cap index slipped 0.09%, while Small cap index was up by 0.14%.

The top gaining sectoral indices on the BSE were Capital Goods up by 0.47%, Telecom up by 0.38%, Power up by 0.22%, PSU up by 0.18% and Industrials was up by 0.14%, while IT down by 1.33%, TECK down by 1.25%, Bankex down by 0.50%, Energy down by 0.41% and Basic Materials was down by 0.26% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 1.38%, Mahindra & Mahindra up by 1.03%, Larsen & Toubro up by 0.57%, Power Grid up by 0.36% and Bajaj Auto was up by 0.25%. On the flip side, Infosys down by 2.15%, Wipro down by 2.05%, Adani Ports down by 1.45%, HDFC down by 1.03% and IndusInd Bank was down by 1.01% were the top losers.

Meanwhile, the Ministry of Commerce in its latest report has showed that India’s Foreign Direct Investment (FDI) increased constantly to $60.97 billion in the financial year 2018 (FY18) from $45.15 billion in Financial year 2015 (FY15). However, the rate of growth in FDI inflows was falling consecutively since the last two years. The rate of growth of FDI in the country has slowed down since the FY16 when it saw a robust growth of 23.05 per cent and FDI inflow was $55.56 billion.

In FY17, the FDI growth slowed to 8.38 per cent, clocking in $60.22 billion. In FY18, the total FDI inflow was $60.97 billion with the growth dropping further to 1.24 per cent. The main sectors which benefited from the FDI inflows in the FY18 were services ($6.7 billion), computer software and hardware ($6.15 billion), telecommunications($6.21 billion), trading ($4.34 billion), construction ($2.73 billion) automobile ($2 billion) and power ($1.62 billion).

Besides, in order to boost the investment environment and to bring in foreign investments in the country, the government had brought in FDI related reforms and liberalized various sectors of the economy. Government plays an active role in investment promotion through dissemination of information on the investment climate and opportunities in India, and by advising prospective investors about investment policies.

The CNX Nifty is currently trading at 10827.60, down by 60.75 points or 0.56% after trading in a range of 10819.10 and 10852.20. There were 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Mahindra & Mahindra up by 1.47%, Sun Pharma up by 1.41%, Bajaj Finserv up by 0.71%, Power Grid up by 0.65% and HPCL was up by 0.63%. On the flip side, Zee Entertainment down by 3.36%, UPL down by 2.64%, Infosys down by 2.20%, Wipro down by 2.00% and Tech Mahindra was down by 1.69% were the top losers.

Asian markets were trading in red, Nikkei 225 slipped 366.79 points or 1.71% to 21,140.09, Hang Seng decreased 255.54 points or 0.98% to 25,832.44, Taiwan Weighted dropped 78.25 points or 0.8% to 9,709.28, Straits Times trembled 56.42 points or 1.81% to 3,057.83, Jakarta Composite dropped 45.54 points or 0.75% to 6,043.77, Shanghai Composite declined 28.32 points or 1.09% to 2,569.65 and KOSPI was down by 12.55 points or 0.61% to 2,058.54.