Benchmarks extend downfall in late afternoon session

The Indian equity benchmarks extended their losses in late afternoon session, with the Sensex and the Nifty falling over 600 and 200 points, respectively. There were no gainers on sectoral indices on the BSE. The markets remained under pressure with report that India's fiscal deficit is expected to touch 7 per cent of GDP in 2020-21 fiscal as against budget estimate of 3.5 per cent, with revenue collections being hit amid disruptions in economic activities due to lockdowns. Traders failed to get any sense of relief, with Reserve Bank of India (RBI) in its latest data showing that bank credit grew 5.52 per cent to Rs 102.19 trillion and deposits increased 11.04 per cent to Rs 140.80 trillion in the fortnight ended August 14. In the year-ago period, bank credit stood at Rs 96.84 trillion and deposit at Rs 126.8 trillion , respectively. On the global front, Asian markets are trading mostly in red. European markets were trading mostly in green as heavyweight oil and gas players were supported by higher crude prices and merger talks in major French utilities saw the sector outperform regional peers.

The BSE Sensex is currently trading at 38829.36, down by 637.95 points or 1.62% after trading in a range of 38704.18 and 40010.17. There were 3 stocks advancing against 27 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index declined 3.16%, while Small cap index was down by 3.96%.

The top losing sectoral indices on the BSE were Healthcare down by 3.96%, Realty down by 3.80%, Basic Materials down by 3.49%, Bankex down by 3.29% and Capital Goods was down by 2.99%, while there were no gainers on sectoral indices on the BSE.

The few gainers on the Sensex were ONGC up by 3.42%, TCS up by 0.40% and HDFC Bank up by 0.13%. On the flip side, Sun Pharma down by 5.80%, SBI down by 4.63%, ICICI Bank down by 4.38%, Kotak Mahindra Bank down by 4.37% and Bajaj Finserv down by 4.19% were the top losers.

Meanwhile, in order to review the implementation of the resolution framework for COVID-19 related stress in bank loans, Union Minister for Finance & Corporate Affairs Nirmala Sitharaman is going to hold a meeting with the top management of Scheduled Commercial Banks and non-banking financial companies (NBFCs) on September 3.

The review will focus on enabling businesses and households to avail of the revival framework on the basis of viability, necessary steps like finalising bank policies and identifying borrowers, and discussing issues that require addressing for smooth and speedy implementation.

The meeting comes ahead of the expected announcement of the KV Kamath-led panel’s recommendations on eligibility parameters for the restructuring of loans to soften the blow to both borrowers and the lenders in the wake of the pandemic.

The CNX Nifty is currently trading at 11430.60, down by 217.00 points or 1.86% after trading in a range of 11407.85 and 11794.25. There were 6 stocks advancing against 44 stocks declining on the index.

The top gainers on Nifty were ONGC up by 2.92%, Bharti Infratel up by 1.94%, Tata Motors up by 1.58%, Wipro up by 0.90% and TCS up by 0.30%. On the flip side, Sun Pharma down by 6.08%, Indusind Bank down by 5.59%, Shree Cement down by 5.39%, SBI down by 5.27% and Eicher Motors down by 5.04% were the top losers.

Asian markets are trading mostly in red, Taiwan Weighted dropped 137.40 points or 1.08% to 12,591.45, Hang Seng decreased 245.01 points or 0.96% to 25,177.05, KOSPI fell 27.63 points or 1.17% to 2,326.17, Straits Times trembled 11.98 points or 0.47% to 2,527.65, Shanghai Composite declined 8.13 points or 0.24% to 3,395.68 and Jakarta Composite was down by108.17 points or 2.02% to 5,238.49. On the flip side, Nikkei 225 was up by 257.11 points or 1.12% to 23,139.76.

European markets were trading mostly in green, France’s CAC increased 63.27 points or 1.26% to 5,066.21 and Germany’s DAX was up 108.51 points or 0.83% to 13,141.71.