Benchmarks turn negative in late afternoon session

Indian benchmarks erased all the gains to turn negative in late afternoon session. Both Sensex and Nifty were trading below their crucial 37,800 and 11100 marks, respectively. A level of pressure was seen on frontline stocks, especially Bharti Airtel and Tata Steel. Market got hit after United Nations Conference on Trade and Development (UNCTAD), in its report for 2020, has projected India’s economy to contract 5.9% in 2020, and warned the country to not repeat its past mistake of announcing austerity measures. However, it forecast the economy to grow 3.9% next year. The contraction in the Indian economy due to the pandemic-led disruptions may disappear next year, but it can cause some irreversible damage to the economy. Sector wise, power stocks remained in focus as the Union ministry of power drafted a Standard Bidding Document (SBD) for the privatisation of the state-owned power distribution companies.

On the global front, Asian markets are trading mixed as spiking infection rates, new containment measures and still no US stimulus fuel concerns about economic recovery. European markets were trading higher with US futures as equity markets built upward momentum after the September selloff cut valuations. The dollar extended its rebound.

The BSE Sensex is currently trading at 37441.81, down by 292.27 points or 0.77% after trading in a range of 37313.09 and 38140.07. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index declined 1.15%, while Small cap index was down by 0.99%.

The only gaining sectoral indices on the BSE were Consumer Durables up by 0.07%, while Telecom down by 7.86%, Power down by 2.34%, Utilities down by 1.86%, Healthcare down by 1.81% and PSU was down by 1.74% were the top losing indices on BSE.

The top gainers on the Sensex were Infosys up by 0.96%, Hindustan Unilever up by 0.75%, Nestle up by 0.73%, Titan Company up by 0.57% and Asian Paints up by 0.18%. On the flip side, Bharti Airtel down by 9.34%, Tata Steel down by 4.60%, Indusind Bank down by 3.70%, NTPC down by 3.25% and TCS down by 3.06% were the top losers.

Meanwhile, in its suggestions list, Industry body the Confederation of Indian Industry (CII) has said that the government should extend the export incentive scheme Merchandise Exports from India Scheme (MEIS) till December 31 in its present form to help exporters.

As per the CII, the extension will help address the accounting problem of exporters as they can book the receivables under the Merchandise Exports from India Scheme in the current financial year. The government has capped export incentives under MEIS at Rs 2 crore per exporter on outbound shipments made during the period from September 1 to December 31, 2020.

Industry body also suggested that the ambit of coverage under the Emergency Credit Line Guarantee Scheme should be extended to the extent of any unutilised amount for revival of stressed sectors, including civil aviation, hospitality and tourism.

The CNX Nifty is currently trading at 11054.30, down by 99.35 points or 0.89% after trading in a range of 11024.40 and 11259.55. There were 12 stocks advancing against 36 stocks declining on the index, while 2 stocks remain unchanged.

The top gainers on Nifty were GAIL India up by 1.07%, Infosys up by 0.99%, Hindustan Unilever up by 0.88%, Nestle up by 0.88% and Wipro up by 0.86%. On the flip side, Bharti Airtel down by 8.51%, Bharti Infratel down by 8.45%, Zee Entertainment down by 6.75%, Tata Steel down by 4.32% and Indusind Bank down by 3.61% were the top losers.

Asian markets are trading mixed; Hang Seng increased 25.66 points or 0.11% to 23,742.51, Straits Times advanced 15.73 points or 0.64% to 2,479.02, Shanghai Composite gained 5.41 points or 0.17% to 3,279.71, KOSPI rose 0.65 points or 0.03% to 2,333.24.On the other hand, Nikkei 225 slipped 13.81 points or 0.06% to 23,346.49, Jakarta Composite lost 16.13 points or 0.33% to 4,917.96 and Taiwan Weighted was down by 61.63 points or 0.49% to 12,583.88.

European markets were trading higher; UK’s FTSE 100 increased 118.55 points or 2.03% to 5,948.01, France’s CAC increased 87.72 points or 1.84% to 4,860.56 and Germany’s DAX was up by 210.49 points or 1.67% to 12,804.88.