Weak trade persists on Dalal Street

Weak trade continued over Dalal Street in late afternoon session, tracking weak European markets. Sentiments remained downbeat, as the Asian Development Bank (ADB) 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. Adding more worries, rating agency ICRA said though domestic apparel exports are expected to remain in the positive zone during rest of the year, there are multiple threats looming which could slow down the pace and make it challenging for exporters.

On the global front, European markets were trading in red, as the Bank of Spain downgraded its growth projections citing weaker domestic demand, deterioration in external environment and uncertainties in global economy. GDP is forecast to grow 2 percent in 2019 instead of 2.4 percent estimated previously. Likewise, the outlook for 2020 was trimmed to 1.7 percent from 1.9 percent and that for 2021 to 1.6 percent from 1.7 percent. Asian markets were also trading in red.

The BSE Sensex is currently trading at 38537.21, down by 559.93 points or 1.43% after trading in a range of 38530.06 and 39087.20. There were 6 stocks advancing against 25 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 2.01%, while Small cap index was down by 1.61%.

The few gaining sectoral indices on the BSE were Power up by 1.55%, Utilities up by 0.80%, IT up by 0.79% and TECK up by 0.40%, while Auto down by 4.10%, Metal down by 3.24%, Realty down by 3.15%, Consumer Disc down by 2.50% and Telecom down by 2.45% were the top losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 5.54%, TCS up by 2.23%, NTPC up by 1.91%, HCL Tech. up by 0.73% and Infosys up by 0.54%. On the flip side, Tata Motors - DVR down by 6.93%, Tata Motors down by 6.69%, SBI down by 6.43%, Maruti Suzuki down by 5.30% and Mahindra & Mahindra down by 4.73% were the top losers.

Meanwhile, calling for domestic & foreign investment and collaboration in the MSME sector, Union Minister for Micro, Small and Medium Enterprises Nitin Gadkari has expressed need to reduce the cost of capital, logistics and power for making the Indian MSME sector globally competitive.

The Minister also highlighted that the MSME sector in India has tremendous potential to push growth and generate employment. He also said the government's priority is for integrated development of the rural and agro-based enterprises along with the urban-based enterprises.

Besides, Gadkari noted that the Government's target is to increase MSME's present share of 29 percent of GDP to 50 percent in the next five years and raise its export contribution from 49 percent to 60 percent. He added that to achieve these targets logistics, power and capital cost will need to be reduced.

The CNX Nifty is currently trading at 11425.75, down by 162.45 points or 1.40% after trading in a range of 11421.80 and 11564.95. There were 9 stocks advancing against 41 stocks declining on the index.

The top gainers on Nifty were Power Grid up by 5.67%, TCS up by 2.22%, NTPC up by 1.82%, Indian Oil Corporation up by 1.37% and BPCL up by 1.13%. On the flip side, Tata Motors down by 6.68%, SBI down by 6.48%, Maruti Suzuki down by 5.26%, Mahindra & Mahindra down by 4.89% and Eicher Motors down by 4.88% 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.

All European markets were trading in red; CAC fell 86.12 points or 1.53% to 5,542.21, DAX lost 145.01 points or 1.18% to 12,162.14 and FTSE was down by 62.85 points or 0.86% to 7,228.58.