Markets turn negative in early noon deals

Indian equity benchmarks erased all gains to turn negative in early noon session, with the Sensex losing over 106 points and Nifty falling below the 12000 level, as inventors turned jittery ahead of an annual economic survey. Local sentiments also got undermined with a report that the government’s efforts to drive ‘Make in India’ to success have not yet reflected in the country’s industrial output growth. India’s Index of Industrial Production (IIP) growth is expected to fall to 2 per cent in the current financial year 2019-20. Meanwhile, market participants are closely monitoring the economic implications of the corona virus outbreak and awaiting cues from the Union Budget. However, downfall remained capped as Indian rupee appreciated against US dollar due to selling in the American currency by banks and exporters. At this point of time, the Rupee strengthened by 7 paise to 71.51 against the US dollar.

On global front, most of the Asian equity benchmarks were trading lower, with still lingering worries on outbreak coronavirus. The World Health Organization declared the coronavirus outbreak a global health emergency while China is doing everything it could to contain the outbreak. Back home, in scrip specific development, shares of Pidilite Industries are trading higher on reporting 56% rise in Q3 consolidated net profit.

The BSE Sensex is currently trading at 40807.42, down by 106.40 points or 0.26% after trading in a range of 40788.63 and 41154.49. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index tumble 0.42%, while Small cap index was down by 0.23%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 0.68%, Bankex up by 0.61%, FMCG up by 0.29%, Consumer Discretionary up by 0.21% and Realty was up by 0.14%, while Oil & Gas down by 1.94%, Utilities down by 1.71%, Energy down by 1.62%, PSU down by 1.54% and Power was down by 1.44% were the top losing indices on BSE.

The top gainers on the Sensex were Kotak Mahindra Bank up by 3.79%, Indusind Bank up by 2.64%, Bajaj Auto up by 2.08%, ITC up by 1.35% and Titan Company was up by 0.67%. On the flip side, ONGC down by 3.94%, Power Grid down by 3.24%, HCL Tech down by 2.41%, TCS down by 2.01% and Reliance Industries was down by 1.49% were the top losers.

Meanwhile, India Ratings and Research (Ind-Ra) in its latest report has said that after a prolonged period of troubles with big-ticket exposures, it will be the loans to agriculture, micro, small and medium enterprises and unsecured retail debt which will become a concern for banks in 2020-21. It noted the size of the corporate stressed asset book, arrived at after an analysis of over 30,000 companies, is lower than the year-ago period and the incremental corporate slippages will slow down in the new fiscal.

According to the report, last two years have seen banks focusing more on the unsecured loans by growing credit cards and personal loans at a faster clip. It said retail product asset quality is deteriorating and pointed out that all major segments like auto, education, and personal loans and credit cards have seen a faster accretion in NPAs. It also flagged potential concerns awaiting lenders on this front, pointing out that job and wage growth in the economy has lagged retail loan growth.

On the corporate side, the agency said 17.9 percent of the total bank credit or Rs 18.5 lakh crore in advances to large value segment as of September 2019 can be classified as stressed, which is down from 19.3 percent in the year-ago period. It said 3.9 percent of the advances, which are now classified as standard stressed assets, are at the highest risk of slipping into NPAs, and these come majorly from the power, real estate and construction sectors.

The CNX Nifty is currently trading at 11986.10, down by 49.70 points or 0.41% after trading in a range of 11984.95 and 12103.55. There were 16 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were Kotak Mahindra Bank up by 3.92%, Indusind Bank up by 2.60%, Bajaj Auto up by 2.15%, ITC up by 1.28% and Britannia Industries was up by 1.14%. On the flip side, ONGC down by 3.81%, Indian Oil down by 3.33%, Power Grid down by 3.11%, Tata Motors down by 3.06% and UPL was down by 2.56% were the top losers.

Asian markets were trading mostly lower, KOSPI fell 11.51 points or 0.54% to 2,136.49, Jakarta Composite lost 90.73 points or 1.5% to 5,966.87, Straits Times trembled 13.46 points or 0.42% to 3,157.22 and Hang Seng was up by 25.89 points or 0.1% to 26,423.24.

On the flip side, Nikkei 225 surged 229.44 points or 1% to 23,207.19 and Taiwan Weighted was up by 94.79 points or 0.83% to 11,516.53.