Markets turn negative in late morning deals

Indian equity benchmarks cut all of their gains in late morning session to turn negative, with both Sensex and Nifty trading below their neutral lines. Key indices lost their gaining momentum despite positive cues from other Asian markets. Traders were seen taking a note of reports that markets regulator SEBI proposed extending the requirement of constituting a risk management committee to top 1,000 listed entities from 500 at present. The risk management committee should meet at least twice in a year from the current practice of minimum one meeting every year, Sebi said in a consultation paper. Considering the multitude of risks faced by listed entities, the regulator said risk management has emerged as a very important function of the board.

On the global front, Asian markets were trading mostly in green, even after South Korea's unemployment rate rose in October. The data from Statistics Korea revealed that the jobless rate rose to a seasonally adjusted 4.2 percent in October from 3.9 percent in September. In the same month last year, the unemployment rate was 3.5 percent. On an unadjusted basis, the unemployment rate increased to 3.7 percent in October from 3.6 percent in the previous month. The number of unemployed increased to 1.02 million in October from 1.0 million in the preceding month. Compared to a year ago, the figure rose by 164,000 persons.

The BSE Sensex is currently trading at 43176.26, down by 101.39 points or 0.23% after trading in a range of 43083.69 and 43708.47. There were 20 stocks advancing against 10 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was up by 0.31%, while Small cap index was down by 0.06%.

The top gaining sectoral indices on the BSE were Healthcare up by 1.79%, Auto up by 1.27%, Power up by 0.97%, Metal up by 0.85% and Utilities up by 0.72%, while Energy down by 2.87%, Consumer Durables down by 1.45%, Realty down by 0.70%, FMCG down by 0.10% and Telecom down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Kotak Mahindra Bank up by 2.33%, Tata Steel up by 2.01%, Axis Bank up by 1.88%, Sun Pharma up by 1.62% and Mahindra & Mahindra up by 1.31%. On the flip side, Indusind Bank down by 4.83%, Reliance Industries down by 3.67%, Titan Company down by 1.94%, Asian Paints down by 1.28% and Hindustan Unilever down by 0.70% were the top losers.

Meanwhile, Crisil Ratings in its latest report has said that revenue of the agrochemical sector is likely to grow 12-14 per cent in the ongoing financial year (FY21) on the back of sharp recovery in offtake from domestic agriculture sector and continuing healthy exports. It added that domestic revenue, which accounts for almost half of the sector's revenue, will grow at 10-12 per cent this fiscal as compared with 6-8 per cent growth last fiscal.

As per the report, the revenue of the Rs 47,000-crore agrochemical sector is expected to grow at 12-14 per cent this financial year, following a sharp recovery in offtake from domestic agriculture sector and continuing healthy exports. It said ‘Higher area under cultivation and 4 per cent increase in minimum support prices during kharif season for key crops such as paddy, cotton, groundnut, soybean and bajra (66 per cent of domestic crop production) will boost agrochemicals consumption this fiscal’.

The report added revenue from exports, which rose 15 per cent in last fiscal, is expected to maintain its pace at 13-15 per cent this fiscal. It said about 65 per cent of agrochemicals demand is derived from kharif (summer) season. An above-average and well-spread monsoon in the first half of the current financial year has led to an increase in kharif sowing area to a five-fiscal high at 1,116 lakh hectares which could help the output by 6-7 per cent this fiscal.

Besides, the present water reservoir level, which is at 87 per cent of capacity, will ensure a healthy increase in acreage in the forthcoming rabi (winter) season as well. Hence, it is likely that overall food grain production in fiscal 2021 may exceed the initial target set by the government at 3,000 lakh tonnes. Exports of agrochemicals should maintain last fiscal's momentum, supported by healthy demand from the United States and Latin America (42 per cent of India's exports). India's strengths of being a low-cost manufacturer, an established presence in generics and skilled labour availability continue to stand it in good stead.

The CNX Nifty is currently trading at 12620.90, down by 10.20 points or 0.08% after trading in a range of 12590.30 and 12769.75. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 3.43%, Hero MotoCorp up by 3.18%, Cipla up by 2.41%, Kotak Mahindra Bank up by 2.22% and Divis Lab up by 2.12%. On the flip side, Indusind Bank down by 4.98%, Reliance Industries down by 3.40%, Titan Company down by 2.10%, Asian Paints down by 1.33% and Britannia down by 1.12% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 433.94 points or 1.74% to 25,339.53, Taiwan Weighted strengthened 146.83 points or 1.12% to 13,228.55, Jakarta Composite soared 46.27 points or 0.85% to 5,509.01, KOSPI rose 27.63 points or 1.13% to 2,480.46 and Shanghai Composite gained 2.92 points or 0.09% to 3,363.07. On the flip side, Straits Times trembled 14.63 points or 0.54% to 2,690.37 and Hang Seng decreased 20.07 points or 0.08% to 26,281.41.