Local equities trade flat with negative bias

Local equity benchmarks were trading flat with a negative bias in morning session, owing to selling pressure in frontline blue-chip counters and weak global cues. Barring FMCG stocks, there was selling across all sectoral indices. Traders took note of a report that Government is unlikely to gain a windfall in one go but will still reap rich financial dividends over the medium term, as the Bimal Jalan panel is set to recommend the transfer of the central bank’s excess reserves to the government over a period of 3-5 years. Besides, a private report stated that terminating India’s position as a beneficiary country under the Generalised System of Preference (GSP) will not only negatively impact export of goods from India to the US, but will also have adverse after-effects for American companies operating in India as their additional tax burden will grow by an additional $300 million every year. However, losses remain capped with International Monetary Fund’s (IMF) report that easing business climate and relaxing trade related norms will help India attract foreign investors and improve the current account deficit situation. Some support also came with Commerce and Industry Minister Piyush Goyal’s statement that huge investment opportunities exist in India in sectors like housing, smart cities, railway stations, gas and telecom grids for UK companies.

On the global front, Asian markets were trading in red, amid renewed trade tensions between US and China. Back home, Asian Development Bank (ADB) has slashed India's gross domestic product (GDP) growth forecast to 7% for the current fiscal (FY20), from 7.2% projected earlier, on the back of fiscal shortfall concerns.

The BSE Sensex is currently trading at 39166.28, down by 49.36 points or 0.13% after trading in a range of 39087.76 and 39204.47. There were 8 stocks advancing against 23 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index slipped 0.52%, while Small cap index was down by 0.37%.

The lone gaining sectoral indices on the BSE was FMCG up by 0.11%, while Metal down by 1.30%, Auto down by 0.91%, Consumer Durables down by 0.90%, Oil & Gas down by 0.74% and Energy was down by 0.73% were the top losing indices on BSE.

The top gainers on the Sensex were HDFC up by 1.61%, HDFC Bank up by 1.13%, Hero MotoCorp up by 1.08%, ITC up by 0.44% and Infosys was up by 0.16%. On the flip side, Yes Bank down by 11.22%, ONGC down by 2.34%, Vedanta down by 2.16%, Maruti Suzuki down by 1.88% and Tata Motors - DVR down was by 1.81% were the top losers.

Meanwhile, in order to lift the majority of population above the poverty line, NITI Aayog CEO Amitabh Kant has said that India needs to grow at the rate of 9-10 percent. This growth will not be possible unless entrepreneurship in the country gets a massive boost. He said start-ups and entrepreneurship will important factors going ahead. India currently ranks third in the world in the startup ecosystem. Over 16,500 startups are recognised in the country and these startups are from 499 districts of the country with 47 percent coming from tier-2 and 3 cities.

He further said that India needs to be open to globalisation, and embrace the growing urbanisation. There are plenty of opportunities emerging due to urbanisation, such as recycling water and waste, mass transportation, education, healthcare, electric vehicles and many more.

Besides, he stated electric vehicles are a sunrise opportunity as India has over 72 percent two-wheelers; our endeavour should be to make these electric, and also manufacture electric vehicles for the world, in India.

The CNX Nifty is currently trading at 11669.40, down by 18.10 points or 0.15% after trading in a range of 11644.85 and 11677.15. There were 15 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were Wipro up by 3.04%, HDFC up by 1.61%, Britannia up by 1.40%, Hero MotoCorp up by 1.11% and HDFC Bank was up by 1.09%. On the flip side, Yes Bank down by 11.18%, ONGC down by 2.43%, Vedanta down by 2.19%, Titan Company down by 1.91% and Maruti Suzuki was down by 1.87% were the top losers.

Asian markets were trading in red; Hang Seng decreased 141.65 points or 0.5% to 28,451.52, Taiwan Weighted dropped 23.11 points or 0.21% to 10,805.37, Nikkei 225 slipped 394.00 points or 1.84% to 21,075.18, KOSPI fell 5.07 points or 0.24% to 2,067.85, Jakarta Composite lost 1.13 points or 0.02% to 6,393.48, Straits Times trembled 10.21 points or 0.3% to 3,354.66 and Shanghai Composite was down by 19.04 points or 0.65% to 2,912.65.