Markets trade lower with cut of over 2% in early deals

Indian equity benchmarks made weak start and extended their losses in early deals on Wednesday following weakness in Asian peers, amid concerns related to coronavirus slowing economic growth. Concerns over fast spreading coronavirus in India also kept investors under pressure. The total number of Covid-19 cases in India has reached 1397, including 1238 active cases, while 124 people have been cured/discharged. Besides, as many as 35 people have died because of Covid-19. There was also some cautiousness with report that the government has missed the collection target for the current financial year from CPSE disinvestment set in the Revised Estimates of Budget by about Rs 14,700 crore. Adding pessimism among market participants a report showed that the government's fiscal deficit touched 135.2% of the full-year target at February-end mainly due to slower pace of revenue collections. Though, traders overlooked the government data showing that eight core sector industries recorded a growth of 5.5% in February, highest in 11-months, mainly due to healthy expansion in output of coal, refinery products and electricity.

On the global front, most of the Asian markets are trading in red following the overnight losses on Wall Street amid lingering concerns about the coronavirus pandemic. Meanwhile, results of a private survey showed that China's manufacturing activity expanded in March, after deteriorating the most on record in February due to the strict measures taken to stem the spread of the coronavirus pandemic.

Back home, Public sector banks (PSB) were in focus as the proposed PSB merger came into effect. Auto sector stocks were also be in action, as automobile manufacturers are set to release their March auto sales figures amid expectations of at least 50% drop in sales. In stock specific developments, ONGC and Reliance Industries fell over 2% after the government cut the domestic natural gas price for the April-September period by a steep 26 percent to its lowest in six years.

The BSE Sensex is currently trading at 28816.31, down by 652.18 points or 2.21% after trading in a range of 28804.74 and 29505.98. There were 3 stocks advancing against 27 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index lost 0.32%, while Small cap index was up by 0.24%.

The only gaining sectoral indices on the BSE was FMCG up by 0.14% while, Bankex down by 3.60%, Metal down by 1.93%, TECK down by 1.76%, IT down by 1.74%, Auto down by 1.70% were the losing indices on BSE.

The few gainers on the Sensex were Indusind Bank up by 2.09%, Hindustan Unilever up by 0.41% and Power Grid up by 0.25%. On the flip side, Kotak Mahindra Bank down by 8.13%, SBI down by 3.58%, Ultratech Cement down by 3.26%, Asian Paints down by 2.95% and Titan Company down by 2.95% were the top losers.

Meanwhile, the Controller General of Accounts (CGA) in its latest data has showed that the government’s fiscal deficit touched 135.2 percent of the full-year target at February-end mainly on account of slower pace of revenue collections. In actual terms, the fiscal deficit or the gap between expenditure and revenue was Rs 10,36,485 crore. During February, there was hardly any impact of the coronavirus outbreak on the economy.

The government aims to restrict the fiscal deficit at 3.8 per cent of the GDP or Rs 7.1 lakh crore in 2019-20. The deficit was 134.2 per cent of 2018-19 Budget Estimate (BE) in the corresponding period. According to data, the government’s revenue receipts were Rs 13.77 lakh crore or 74.5 per cent of the 2019-20 revised estimate (RE). In the same period last fiscal, the collections were 73.2 per cent of the RE.

The data also showed that total expenditure was 91.4 per cent of RE or Rs 24.65 lakh crore. During the corresponding period in 2018-19, the expenditure was 89.1 per cent of the RE. Of the total spending, the capital expenditure was 87.5 per cent of the RE, higher than 86.6 per cent of the estimates during the same period in 2018-19. While presenting the Union Budget last month, Finance Minister Nirmala Sitharaman had raised fiscal deficit target to 3.8 per cent of the GDP from 3.3 per cent pegged earlier for 2019-20 due to revenue shortage.

The CNX Nifty is currently trading at 8390.10, down by 207.65 points or 2.42% after trading in a range of 8383.90 and 8588.10. There were 5 stocks advancing against 45 stocks declining on the index.

The top gainers on Nifty were Indusind Bank up by 2.31%, Britannia Industries up by 1.55%, GAIL India up by 0.46%, Cipla up by 0.41% and Power Grid up by 0.13%. On the flip side, Kotak Mahindra Bank down by 8.13%, Adani Ports & SEZ down by 6.13%, SBI down by 3.76%, Infosys down by 3.53% and HDFC Bank down by 3.36% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 slipped 261.20 points or 1.38% to 18,655.81, Straits Times declined 29.01 points or 1.17% to 2,452.22, Hang Seng fall 207.38 points or 0.88% to 23,396.10, Taiwan Weighted plunged 3.80 points or 0.04% to 9,704.26 and KOSPI dropped 2.27 points or 0.13% to 1,752.37. On the other hand, Jakarta Composite advanced 25.91 points or 0.57% to 4,564.84 and Shanghai Composite was up by 8.36 points or 0.30% to 2,758.66.