Indian bourses continue to trade in negative terrain

Indian bourses continued to trade in negative territory in afternoon session, as investors turned cautious ahead of the third quarter earnings season next week. The mood on the street remained cautious with the commerce ministry’s data showing that eight core industries grew at its slowest pace in 16 months at 3.5% in November due to fall in output of crude oil and fertilizers. Core sector growth was 6.9 percent in November 2017. Some anxiety also remained among the local traders with policy advocacy body US-India Strategic Partnership Forum (USISPF) saying that India’s recent changes in e-commerce foreign direct investment (FDI) rules show a lack of predictability in the regulatory environment and could add to the long list of trade issues that the country is trying to resolve with the United States. However, further losses were restricted as some support came in with the Finance Ministry stating that the government is closely monitoring the macroeconomic conditions in order to ensure that the fiscal deficit remains within the target of 3.3% of the Gross Domestic Product (GDP) for 2018-19.

The BSE Sensex is currently trading at 35982.57, down by 85.76 points or 0.24% after trading in a range of 35912.59 and 36224.00. There were 9 stocks advancing against 22 stocks declining on the index. Back home, Tyre sector was buzzing with rating agency ICRA stating that the Indian tyre industry may log 7-9 percent growth over the next five year backed by favourable outlook for the domestic automotive industry. Besides, shares of state-run banks traded higher as the government infused Rs 10,882 crore in four public sector banks, including UCO Bank and Syndicate Bank, as part of Rs 28,615 crore capital infusion to be done in about half a dozen public sector lenders.

The broader indices were trading mixed; the BSE Mid cap index fell 0.07%, while Small cap index was up by 0.29%.

The top gaining sectoral indices on the BSE were Realty up by 2.04%, Telecom up by 0.60%, Consumer Durables up by 0.48%, Healthcare up by 0.21% and Oil & Gas up by 0.14%, while Metal down by 0.80%, FMCG down by 0.39%, Basic Materials down by 0.26%, Auto down by 0.17% and Power down by 0.17% were the top losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 1.38%, Axis Bank up by 1.06%, Sun Pharma up by 0.95%, Bharti Airtel up by 0.70% and Bajaj Auto up by 0.43%. On the flip side, Indusind Bank down by 1.22%, Tata Steel down by 1.12%, Mahindra & Mahindra down by 0.84%, Asian Paints down by 0.72% and Hindustan Unilever down by 0.66% were the top losers.

Meanwhile, India's external debt has witnessed a decline of 3.6 percent to $510.4 billion at September-end over its level at end-March 2018, on account of a decrease in commercial borrowings, short-term debt, non-resident Indian (NRI) deposits and valuation effect. According to the Reserve Bank of India (RBI), the decrease in the magnitude of external debt was mainly due to valuation gains resulting from dollar's strength against Indian rupee and major global currencies overseas. It added that valuation gains due to the appreciation of the dollar vis-a-vis the rupee and major currencies were placed at $25.4 billion.

Excluding the valuation effect, the central bank noted that the increase in external debt would have been $6.1 billion instead of a decrease of $19.3 billion at end-September 2018 over end-March 2018. The debt was $529.7 billion at the end of March 2018.Commercial borrowings continued to be the largest component of external debt with a share of 37.1 percent, followed by NRI deposits (23.9 per cent) and short-term trade credits (19.9 per cent).

As per RBI, at the end of September 2018, long-term debt (with original maturity of above one year) was placed at $406.1 billion, recording a decline of $21.4 billion over its level at the end of March 2018. According to the standard practice, the country's external debt statistics are released with a lag of one quarter. Dollar-denominated debt, with a share of 49.7 percent, continued to be the largest component of India's external debt at September-end, followed by the rupee (36.1 percent), SDR (5.3 percent), the yen (4.7 per cent) and the euro (3.2 percent).

The CNX Nifty is currently trading at 10837.35, down by 25.20 points or 0.23% after trading in a range of 10813.65 and 10885.30. There were 17 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were Yes Bank up by 1.40%, Axis Bank up by 1.04%, Sun Pharma up by 1.01%, Bharti Airtel up by 0.83% and Grasim Industries up by 0.76%. On the flip side, Hindalco down by 1.59%, Indusind Bank down by 1.36%, NTPC down by 1.04%, Mahindra & Mahindra down by 0.98% and Indiabulls Housing Finance down by 0.98% were the top losers.