Indian bourses continue to trade under pressure

In line with Asian peers, Indian bourses remained under heavy selling pressure in afternoon session, on the back of sustained selling activities by market-participants. Sentiments remained downbeat with the Asian Development Bank (ADB) sharply cut India's growth forecast to 6.5% for the current fiscal, weighed down by the GDP growth rate dipping to a six-year low in the first quarter. Cautiousness also remained in markets ahead of September derivatives series expiry due tomorrow. Traders also took a note of Communications and IT minister Ravi Shankar Prasad’s statement that India should aim to become the largest foreign direct investment (FDI) recipient globally as the country offers a huge market and investor-friendly policies. With the recent announcements on tax-relief for manufacturing, India is now at par with the tax regime of countries like Vietnam and Thailand. On the sectoral front, stocks related to Auto sector edged lower with report that bank loans to finance vehicle purchases in India has slipped to 4.9% year-on-year at the end of July, less than half of the growth recorded in the year-ago period, indicating a slump in demand for cars and trucks which is in sync with the overall private consumption slowdown.

On the global front, Asian markets were trading in red after the U.S. lawmakers called for an impeachment inquiry into President Donald Trump, increasing the prospects of prolonged political uncertainty in the world's largest economy. Back home, the BSE Sensex is currently trading at 38707.56, down by 389.58 points or 1.00% after trading in a range of 38652.15 and 39087.20. There were 7 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 1.47%, while Small cap index was down by 0.81%.

The top gaining sectoral indices on the BSE were Power up by 2.13%, Utilities up by 1.34%, IT up by 0.82% and TECK up by 0.55%, while Auto down by 3.31%, Realty down by 2.35%, Metal down by 2.19%, Consumer Disc down by 1.90% and Telecom was down by 1.63% were the top losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 6.01%, NTPC up by 2.56%, TCS up by 1.89%, HCL Technologies up by 0.78% and Tech Mahindra was up by 0.70%. On the flip side, SBI down by 5.14%, Tata Motors - DVR down by 4.92%, Tata Motors down by 4.74%, Mahindra & Mahindra down by 4.73% and Hero MotoCorp was down by 3.58% were the top losers.

Meanwhile, the Asian Development Bank (ADB) has lowered India's gross domestic product (GDP) growth forecast to 6.5 percent for the current fiscal (FY20), weighed down by the GDP growth slipping to a six-year low in the April-June quarter of 2019-20. In its supplement to the Asian Development Outlook (ADO) in July, it had cut the country's GDP growth estimate to 7 percent for FY20 on the back of fiscal shortfall concerns.

ADB said that abrupt declines in manufacturing and investment reflect uncertainty ahead of general elections, subdued lending by banks and other financial institutions, stress in the rural economy, and a weakening external outlook.

However, it said India is expected to rebound to 7.2 percent growth in FY21 and join most other sub regional countries in performing at or near their ADO 2019 growth forecasts for next year. As per the latest ADO, South Asia's growth momentum has softened. For the region, the growth forecasts are lowered to 6.2 percent for 2019 and 6.7 percent for 2020.

The CNX Nifty is currently trading at 11475.20, down by 113.00 points or 0.98% after trading in a range of 11463.05 and 11564.95. There were 11 stocks advancing against 39 stocks declining on the index.

The top gainers on Nifty were Power Grid up by 6.22%, NTPC up by 2.65%, TCS up by 1.92%, Tech Mahindra up by 0.76% and Bajaj Finserv was up by 0.74%. On the flip side, SBI down by 5.12%, Mahindra & Mahindra down by 4.84%, Tata Motors down by 4.66%, Eicher Motors down by 3.66% and Hero MotoCorp was down by 3.63% were the top losers.

All Asian markets were trading in red; Hang Seng decreased 315.89 points or 1.2% to 25,965.11, Nikkei 225 slipped 78.69 points or 0.36% to 22,020.15, Straits Times trembled 23.83 points or 0.76% to 3,131.63, KOSPI fell 27.65 points or 1.32% to 2,073.39, Shanghai Composite declined 24.22 points or 0.81% to 2,961.12, Taiwan Weighted dropped 44.32 points or 0.41% to 10,873.69 and Jakarta Composite lost 10.47 points or 0.17% to 6,127.14.