Bourses remain sluggish in afternoon session

Key Indian benchmarks remained sluggish in afternoon session, with Sensex losing 145 points and Nifty falling below the 11650 level. Traders were seen in selling position for energy, oil and gas, and IT stocks, while buying was witnessed in realty, telecom and banking stocks. The mood on the street remained cautious with private report that the pandemic-induced growth contraction and additional spending to support the needy amounting to a little over 2 percent of the economy are likely to push the combined fiscal deficit to 13 percent of GDP this fiscal - nearly double of the past year. However, downfall remain capped as India's manufacturing sector activity improved for the third straight month in October with companies raising output to the greatest extent in 13 years amid robust sales growth. The headline seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index (PMI) rose from 56.8 in September to 58.9 in October, and pointed to the strongest improvement in the health of the sector in over a decade.

On the global front; Asian markets were trading mostly higher with the optimism in global economic recovery followed by the positive signs in manufacturing sector of China. Back on street, The BSE Sensex is currently trading at 39468.30, down by 145.77 points or 0.37% after trading in a range of 39334.92 and 39880.46. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index rose 0.18%, while Small cap index was down by 0.61%.

The top gaining sectoral indices on the BSE were Realty up by 3.23%, Telecom up by 2.74%, Bankex up by 2.67%, Power up by 0.95% and Capital Goods was up by 0.78%, while Energy down by 5.45%, Oil & Gas down by 2.21%, IT down by 0.96%, Healthcare down by 0.81% and Metal was down by 0.53% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 6.56%, ICICI Bank up by 4.97%, Bharti Airtel up by 4.12%, Axis Bank up by 3.11% and SBI was up by 2.59%. On the flip side, Reliance Industries down by 6.59%, HCL Tech down by 2.40%, TCS down by 1.84%, Tata Steel down by 1.79% and Asian Paints was down by 1.72% were the top losers.

Meanwhile, Chief Economic Adviser (CEA) K V Subramanian has said that India Inc needs to respond to various reform measures, including in the labour sector, undertaken by the government to accelerate the growth impacted by the coronavirus disease (covid-19) pandemic. He emphasized that India is the only country which utilised the opportunity provided by the current crisis to unleash the second generation reforms that are focused on factor markets.

Subramanian said ‘if you look at the reforms that have happened since 1991, most of those reforms were primarily focused on product markets, including the reforms that were launched by the Atal Bihari Vajpayee government as well. But now when you look at the reforms that have been launched together with some of the previous ones, like IBC (Insolvency and Bankruptcy Code), (they are) basically an attempt to reform the capital.’ He noted that IBC is followed by labour reforms and cost of labour is an important factor of production.

The CEA noted that agriculture, which is another important factor, is part of the primary sector. He also said  ‘so, when you take these into account, there is a very important theme of Aatmanirbhar Bharat which is primarily about relying on the private sector enterprise and on the efficiency that private sector brings’. He also stated that these reforms signal that the intent of this government is to rely on markets and that efficiency is primarily brought in by the private sector. Observing that the idea of Aatmanirbhar Bharat is not anathema to competition, he said self-reliance can never happen without adequate capabilities. 

The CNX Nifty is currently trading at 11609.90, down by 32.50 points or 0.28% after trading in a range of 11557.40 and 11697.35. There were 22 stocks advancing against 27 stocks declining, while 1 stock remains unchanged on the index.

The top gainers on Nifty were Indusind Bank up by 6.81%, ICICI Bank up by 5.44%, Bharti Airtel up by 4.24%, Axis Bank up by 3.33% and SBI was up by 2.69%. On the flip side, Reliance Industries down by 6.13%, Divis Lab down by 2.29%, BPCL down by 2.14%, HCL Tech down by 2.14% and Britannia Industries was down by 2.11% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 318.35 points or 1.39% to 23,295.48, Straits Times advanced 16.12 points or 0.67% to 2,439.96, Hang Seng increased 297.77 points or 1.24% to 24,405.19, Taiwan Weighted strengthened 44.97 points or 0.36% to 12,591.31 and KOSPI was up by 33.01 points or 1.46% to 2,300.16. On the other hand, Jakarta Composite lost 13.68 points or 0.27% to 5,114.55 and Shanghai Composite was down by 1.68 points or 0.05% to 3,222.85.