Bears hold grip on Indian markets

Bears were holding their tight grip over Indian equity benchmarks in late afternoon session, despite firm cues from European markets. Domestic sentiments were pessimistic, as International rating agency Moody's Investors Service in its latest report said that India's weaker growth outlook will dampen prospects for the government's fiscal consolidation plans and hamper its ability to prevent a rise in the debt burden. Adding more worries, the World Bank said that Asia Pacific economies are expected to slow this year due to uncertainty around U.S.-China trade tensions and slowdowns in major global economies could further hurt the region's exports.

On the global front, European markets were trading in green, after Estonia's trade deficit decreased in August as exports and imports declined. The figures from Statistics Estonia showed that the trade deficit fell to EUR 99 million in August from EUR 162 million in the same month previous year. In July, the deficit was EUR 201 million. Asian markets were also trading in green.

The BSE Sensex is currently trading at 37836.03, down by 341.92 points or 0.90% after trading in a range of 37802.93 and 38130.23. There were 7 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.92%, while Small cap index was down by 0.53%.

The few gaining sectoral indices on the BSE were Telecom up by 3.47%, Energy up by 1.72%, TECK up by 0.30% and Oil & Gas was up by 0.08%, while Bankex down by 2.93%, Realty down by 2.22%, Auto down by 1.39%, Metal down by 1.34% and PSU was down by 1.13% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 4.30%, Reliance Industries up by 2.77%, HCL Tech. up by 1.20%, Sun Pharma up by 1.13% and Hindustan Unilever was up by 0.71%. On the flip side, Yes Bank down by 5.79%, Indusind Bank down by 4.05%, Tata Motors down by 3.19%, ICICI Bank down by 3.10% and Tata Motors - DVR was down by 2.80% were the top losers.

Meanwhile, international rating agency Moody's Investors Service in its latest report has cut India's gross domestic product (GDP) growth forecast to 5.8 per cent for the current fiscal year (FY20) from 6.8 per cent in FY19, but it expects GDP to pick up to 6.6 per cent in FY21 and around 7 per cent over the medium term.

The rating agency pointed that the drivers of the deceleration are multiple, mainly domestic factors and in part, long-lasting. 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.

Moody’s further said that prolonged softer growth will dampen prospects for the government's fiscal consolidation plans and hamper its ability to prevent a rise in the debt burden. As per rating agency, given India's already weak fiscal position, this will weigh on the sovereign credit profile.

The CNX Nifty is currently trading at 11218.25, down by 95.05 points or 0.84% after trading in a range of 11208.55 and 11293.35. There were 12 stocks advancing against 38 stocks declining on the index.

The top gainers on Nifty were Bharti Airtel up by 4.51%, Grasim Industries up by 3.13%, Reliance Industries up by 2.84%, HCL Tech. up by 1.19% and Sun Pharma up by 0.86%. On the flip side, Yes Bank down by 6.13%, Indusind Bank down by 4.65%, GAIL India down by 3.56%, Tata Motors down by 3.39% and ICICI Bank down by 3.32% 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.

All European markets were trading in green; FTSE gained 1.33 points or 0.02% to 7,167.83, CAC rose 23.43 points or 0.43% to 5,522.57 and DAX was up by 25.31 points or 0.21% to 12,119.57.