Weakness persist in markets in afternoon deals

Indian benchmark indices continued to trade in red in afternoon session due to selling in frontline blue chip stocks. The sentiment remained dull as Moody’s Investors Service cut India’s gross domestic product (GDP) growth forecast for 2019-20 to 5.8% from the earlier estimate of 6.2%. It attributed the deceleration to an investment-led slowdown that has broadened into consumption, driven by financial stress among rural households and weak job creation. Some anxiety was also among the local traders with a private report that a workforce analysis of listed companies reveals that the job loss in public sector was one of the worst in the recent times. In contrast to an increase of 9.2 per cent headcount in private sector, the public sector saw a decline of 2.6 per cent in FY19. Investors also remained cautious ahead of important September quarter earnings by Tata Consultancy Services (TCS) and IndusInd Bank to be announced later in the day.

On the global front, Asian markets were mostly trading in green, as news reports raised hopes that the US and China would settle some economic disputes, but investors were kept on edge by an earlier report that trade talks due to begin on Thursday could be cut short. Back home, the BSE Sensex is currently trading at 37881.83, down by 296.12 points or 0.78% after trading in a range of 37861.63 and 38130.23. There were 9 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.88%, while Small cap index was down by 0.44%.

The top gaining sectoral indices on the BSE were Telecom up by 3.80%, Energy up by 1.55%, TECK up by 0.28%, Consumer Durables up by 0.08% and Oil & Gas was up by 0.05%, while Bankex down by 2.36%, Realty down by 2.28%, PSU down by 1.04%, Metal down by 0.95% and Auto was down by 0.85% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 5.32%, Reliance Industries up by 2.39%, Hindustan Unilever up by 0.80%, HCL Technologies up by 0.68% and Bajaj Auto was up by 0.50%. On the flip side, Yes Bank down by 4.75%, Tata Motors down by 3.19%, ICICI Bank down by 3.11%, Tata Motors - DVR down by 2.90% and SBI was down by 2.66% were the top losers.

Meanwhile, International Monetary Fund (IMF) chief Kristalina Georgieva has said that the largest emerging market economies like India are facing an even more pronounced effect of the global downturn. She also warned that the global economy is now witnessing synchronized slowdown which will result in slower growth for 90 percent of the world in 2019.

The IMF chief further said that despite this overall deceleration, about 40 emerging markets and developing economies, including 19 in sub-Saharan Africa, will have real GDP growth rates above 5 percent. In the United States and Germany, she said unemployment is at historic lows. She also said yet across advanced economies, including in the US, Japan and especially the euro area, there is a softening of economic activity. In China, she said growth is gradually coming down from the rapid pace it saw for many years.

Georgieva has stated that now is the time for countries with room in their budgets to deploy-or get ready to deploy-fiscal firepower. She also felt that low interest rates may give some policymakers additional money to spend. Referring to a new IMF research, which shows how structural reforms can raise productivity and generate enormous economic gains, she said these changes are the key to achieving higher growth over the medium and long-term. She pointed out that the right reforms in the right sequence could double the speed at which emerging markets and developing economies reach the living standards of the advanced economies. 

The CNX Nifty is currently trading at 11238.10, down by 75.20 points or 0.66% after trading in a range of 11224.35 and 11293.35. There were 13 stocks advancing against 37 stocks declining on the index.

The top gainers on Nifty were Bharti Airtel up by 5.12%, Grasim Industries up by 3.74%, Reliance Industries up by 2.50%, Hindustan Unilever up by 0.87% and Bajaj Auto was up by 0.77%. On the flip side, Yes Bank down by 4.62%, GAIL India down by 3.97%, Tata Motors down by 3.14%, ICICI Bank down by 2.98% and Mahindra & Mahindra was down by 2.66% were the top losers.

Asian markets were mostly trading in green; Nikkei 225 surged 95.60 points or 0.45% to 21,551.98, Hang Seng increased 95.43 points or 0.37% to 25,778.24, Shanghai Composite gained 17.48 points or 0.6% to 2,942.34 and Jakarta Composite was up by 7.93 points or 0.13% to 6,037.09.

On the flip side, Straits Times trembled 4.79 points or 0.16% to 3,085.11 and KOSPI was down by 18.10 points or 0.88% to 2,028.15.