Benchmarks fall in early deals; Sensex below 36,800 mark

India equity benchmarks made negative start and are trading lackluster with cut of over one third of a percent in early deals on Monday. Sensex and Nifty fell below their crucial levels of 36,800 and 10,950, respectively. Broader indices were also following larger peers. Markets came under pressure amid losses in banking, auto and IT stocks amid unabated foreign fund outflow. Auto stocks witnessed selling pressure amid report that states opposed cutting tax rates even as central government ready to reduction in GST rate from 28% to 18%. Investors remained on sidelines and avoided taking long positions ahead of holiday and key macroeconomic data due later in the week. Some cautiousness crept in with the Reserve Bank of India’s (RBI) data showing that the country's foreign exchange reserves fell by $446 million to $428.604 billion in the week to August 30, mainly on account of a drop in foreign currency assets.

Market participants failed to take any sense of relief with report that amid ongoing slowdown of the economy, Union finance Minister Nirmala Sitharaman said that the government will respond to the challenges faced by all the sectors. Traders also overlooked the Central Government’s statement that the current slowdown is temporary and the fundamentals of the Indian economy remain strong.

On the global front, Asian markets were trading mostly in green as weak economic data from the US and China raised hopes of further stimulus from global central banks. Data released Friday showed weaker than expected US jobs growth in the month of August, while data from China showed that the country's exports unexpectedly fell in the month. Back home, in scrip specific development, Vivimed Labs shined on entering into definitive agreements for transfer and sale of its wholly owned subsidiary -- Vivimed Labs Europe to Vivimed Specialty Chemicals UK.

The BSE Sensex is currently trading at 36798.78, down by 182.99 points or 0.49% after trading in a range of 36784.47 and 36970.03. There were 5 stocks advancing against 26 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index declined 0.14%, while Small cap index was down by 0.16%.

The top gaining sectoral indices on the BSE were Telecom up by 0.50%, Healthcare up by 0.36%, FMCG up by 0.10%, Capital Goods up by 0.04% and Realty was up by 0.02%, while Auto down by 1.39%, Metal down by 0.89%, Bankex down by 0.76%, Consumer discretionary down by 0.58% and PSU was down by 0.53% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 1.44%, Bharti Airtel up by 0.57%, Hindustan Unilever up by 0.49%, Yes Bank up by 0.41% and Asian Paints up by 0.19%. On the flip side, Tata Motors - DVR down by 3.28%, Tata Motors down by 2.89%, Maruti Suzuki down by 2.15%, Bajaj Auto down by 1.18% and Hero MotoCorp down by 1.16% were the top losers.

Meanwhile, in order to achieve India's target of becoming a $5 trillion economy, Niti Aayog Chief Executive Officer Amitabh Kant has said that states will have to become key agents of growth. He added that states have to work together and learn from each other to radically transform India.

He further said that the government is focusing on the target of becoming a $5 trillion economy by 2024 and subsequently a $10 trillion economy by 2030. Therefore, he said ‘our challenge really is that it will not be possible for India to achieve this until states do not aim to double and triple their GDPs. And this would require major structural reforms and structural reforms over a vast range of sectors.’

He pointed out sectors like agriculture and labour where structural reforms are required. The current size of the Indian economy is estimated at $2.7 trillion. Besides, the central government has announced and initiated several steps to make India a $5 trillion economy over the next few years.

The CNX Nifty is currently trading at 10908.15, down by 38.05 points or 0.35% after trading in a range of 10889.80 and 10936.70. There were 14 stocks advancing against 35 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were UPL up by 1.59%, Sun Pharma up by 1.28%, Bharti Airtel up by 0.92%, Yes Bank up by 0.91% and Bharti Infratel up by 0.80%. On the flip side, Tata Motors down by 2.31%, Eicher Motors down by 1.87%, Maruti Suzuki down by 1.85%, JSW Steel down by 1.65% and Tata Steel down by 1.58% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 98.72 points or 0.47% to 21,298.29, Jakarta Composite soared 16.63 points or 0.26% to 6,325.58, Shanghai Composite gained 10.91 points or 0.36% to 3,010.51, KOSPI rose 9.17 points or 0.46% to 2,018.30, Taiwan Weighted strengthened 9.09 points or 0.08% to 10,789.73, Straits Times advanced 3.72 points or 0.12% to 3,148.20. On the flip side, Hang Seng was down by21.38 points or 0.08% to 26,669.38.