Local equities continue sluggish trade; Nifty below 11,450 mark

Local equity benchmarks continued their sluggish trade in morning session, with Sensex and Nifty falling more than 300 and 90 points, respectively. Selling was broad based with both mid cap and small cap indices were trading down by over 1%. Investors remained jittery with a report that India had a ‘worrisome’ debt burden of over Rs 88 lakh crore at the first financial quarter of 2019 with the government apparently having no inkling to deal with the country’s economic slowdown. Traders remain concerned with the RBI’s data showing that India's forex reserves declined by $388 million to $428.572 billion for the week ended September 20 due to a slide in core currency and gold assets. Beside, Union road transport minister Nitin Gadkari stated that using bio-fuels can reduce crude oil imports which will help save foreign exchange on one hand also achieve the $5-trillion GDP goal by 2025. Traders failed to get any sense of relief from a report that despite reeling under the impact of worst ever attacks on its oil installations, Saudi Arabia has said that it is looking at investing $100 billion in India in areas of petrochemicals, infrastructure and mining among others, considering the country’s growth potential.

On the global front, Asian markets were trading mostly in red as investors remained cautious ahead of a week-long patriotic holiday in China and after reports last week raised fears of a fresh escalation in its trade war with the US. Back home, the World Bank in its Doing Business 2020 report has ranked India as one of the ‘top 20 improvers’ based on the number of reforms which aid ease of doing business.

The BSE Sensex is currently trading at 38505.52, down by 317.05 points or 0.82% after trading in a range of 38467.29 and 38873.12. There were 7 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index slipped 1.22%, while Small cap index was down by 1.21%.

The few gaining sectoral indices on the BSE were IT up by 1.05%, TECK up by 0.73%, Energy up by 0.23% and Oil & Gas was up by 0.02%, while Realty down by 2.68%, BANKEX down by 2.40%, Metal down by 2.28%, Basic Materials down by 1.50% and Healthcare was down by 1.40% were the top losing indices on BSE.

The top gainers on the Sensex were HCL Tech up by 1.75%, Infosys up by 1.27%, TCS up by 1.21%, ITC up by 0.71% and Tech Mahindra was up by 0.62%. On the flip side, Yes Bank down by 10.35%, IndusInd Bank down by 6.11%, ICICI Bank down by 3.67%, Vedanta down by 3.05% and Tata Steel was down by 2.88% were the top losers.

Meanwhile, Union road transport minister Nitin Gadkari has said using bio-fuels can reduce crude oil imports. He stated reduce oil imports will help save foreign exchange on one hand also achieve the $5-trillion Gross domestic products (GDP) goal by 2025. He mentioned that his ministry has taken various steps to promote bio-fuels like ethanol and butanol which are not only feasible but also desirable for the nation as it will also help reduce the emissions.

He further highlighted ‘Every year we spend around Rs 7 lakh crore on oil imports. In this scenario if we have alternate bio-fuels like ethanol and butanol which can be used in cars and aircraft, why should we not explore those options. They are not just cheap but also pollution-free.’ He added the aviation sector imports Rs 40,000 crore worth of fuel and if they explore bio-fuels, it opens a Rs 40,000-crore market for domestic players.

Moreover, he stated aviation bio-fuels are widely accepted in the US and Britain. If India also uses it, the country will save lots of foreign exchange. He also said steps are being taken to reduce coal imports as well. He mentioned ‘we are studying the feasibility of using napier grass which has higher calorific value instead of coal. I strongly feel that if we undertake these measures, we will be able to achieve our $5-trillion GDP target.’

The CNX Nifty is currently trading at 11419.65, down by 92.75 points or 0.81% after trading in a range of 11410.25 and 11504.60. There were 13 stocks advancing against 37 stocks declining on the index.

The top gainers on Nifty were HCL Tech up by 1.83%, UPL up by 1.46%, BPCL up by 1.43%, TCS up by 1.30% and Infosys was up by 1.27%. On the flip side, Yes Bank down by 10.46%, Zee Entertainment down by 6.36%, IndusInd Bank down by 5.96%, ICICI Bank down by 3.75% and Cipla was down by 3.06% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 slipped 180.51 points or 0.83% to 21,698.39, Jakarta Composite lost 35.62 points or 0.57% to 6,161.27, Shanghai Composite declined 11.71 points or 0.4% to 2,920.46 and Straits Times was down by 9.81 points or 0.31% to 3,115.82.

On the other side; KOSPI rose 10.60 points or 0.52% to 2,060.53 and Hang Seng was up by 141.18 points or 0.54% to 26,095.99.