Markets continue to trade flat with negative bias

Indian equity benchmarks continued to trade flat with a negative bias in morning trade, as vaccine hopes were offset by rising cases of coronavirus worldwide. Sentiments remained lackluster even as private report upgraded its India GDP forecast to a contraction of 10.3 per cent in FY21, as against its earlier estimate of a negative growth of 14.8 per cent. The US-based firm said developments on the vaccine front -- where two candidates have posted satisfactory progress -- will be very helpful in the recovery. Market participants also took a note of Prime Minister Narendra Modi’s statement that his government will leave no stone unturned to make India a preferred global investment destination as he pitched for foreign investment to modernise urban centres, offering a business friendly climate and a huge market. As the nation rebuilds post pandemic, he said COVID-19 has given governments the chance to accelerate the 'process of making cities more liveable for people.  

On the global front, Asian markets were trading mostly in green even as rising cases of coronavirus worldwide and growing tensions between the U.S. and China. Meanwhile, the Ministry of Finance said Japan posted a merchandise trade surplus of 872.899 billion yen in October. That exceeded forecasts for a surplus of 250 billion yen following the surplus of 675 billion yen in September. Exports were down 0.2 percent on year at 6.566 trillion yen, beating expectations for a decrease of 4.5 percent following the 4.9 percent drop in the previous month. Imports were down an annual 13.3 percent at 5.693 trillion yen versus expectations for a fall of 9.9 percent following the 17.2 percent tumble a month earlier.

The BSE Sensex is currently trading at 43939.91, down by 12.80 points or 0.03% after trading in a range of 43816.15 and 44051.66. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.79%, while Small cap index was up by 0.72%.

The top gaining sectoral indices on the BSE were Capital Goods up by 2.17%, Industrials up by 1.77%, Realty up by 1.37%, Power up by 1.20% and Utilities up by 1.03%, while FMCG down by 0.96%, Consumer Durables down by 0.75%, Telecom down by 0.71%, TECK down by 0.70% and IT down by 0.67% were the top losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 3.46%, Larsen & Toubro up by 3.19%, SBI up by 2.41%, Bajaj Finance up by 2.40% and Indusind Bank up by 2.29%. On the flip side, Hindustan Unilever down by 1.86%, Titan Company down by 1.71%, TCS down by 1.24%, Tata Steel down by 1.17% and Nestle down by 1.10% were the top losers.

Meanwhile, Indian oil minister Dharmendra Pradhan has asked exploration companies to consider farming out their acreages to global players with advanced technology to expedite development and raise oil and gas output. India, the world's third biggest oil importer and consumer, depends on foreign purchases for over 80% of its oil needs. The nation's oil and gas output has been stagnant for years, forcing it to raise reliance on imports to meet rising fuel demand.

He said the government will grant petroleum mining lease rights but the companies should consider a farm-out (of a stake) to get global technology players. He stated Indian exploration companies should work at exponential speed to unlock resources.

India's exploration licensing rounds have so far seen a lukewarm response from global oil majors, with most of the blocks awarded to local companies, mainly ONGC and Oil India. He mentioned the companies have to reject a 'business as usual approach' and adopt a professionally-run 'commercially viable and technological friendly' model to boost output. He urged Indian exploration companies to function like holding firms and share revenue and profit with their new technical and financial partners. This will also boost the nation's resources and add to the federal exchequer.

The CNX Nifty is currently trading at 12861.65, down by 12.55 points or 0.10% after trading in a range of 12836.45 and 12901.75. There were 18 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were Larsen & Toubro up by 3.52%, Mahindra & Mahindra up by 3.24%, Tata Motors up by 3.20%, Bajaj Finance up by 2.77% and Adani Ports &SEZ up by 2.46%. On the flip side, BPCL down by 3.33%, Hindustan Unilever down by 1.96%, Titan Company down by 1.84%, Dr. Reddys Lab down by 1.38% and Britannia Industries down by 1.32% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 157.57 points or 0.6% to 26,572.66, Taiwan Weighted strengthened 138.59 points or 1.02% to 13,731.60, Jakarta Composite soared 21.22 points or 0.38% to 5,551.16, Shanghai Composite gained 15.79 points or 0.47% to 3,355.69, Straits Times advanced 7.67 points or 0.28% to 2,786.22 and KOSPI rose 6.30 points or 0.25% to 2,545.45.

On the flip side, Nikkei 225 slipped 198.70 points or 0.76% to 25,815.92.