Markets turn negative in late morning deals

Indian equity benchmarks cut all of their gains to turn negative in late morning deals, with both Sensex and Nifty trading below their neutral lines. Sentiments over the street remained negative, despite positive cues from other Asian markets. Domestic sentiments were also negative, as Niti Aayog Member (Health) V K Paul said that India's overall spending on the health sector is 'low' and the situation must be 'corrected'. Emphasising that there is a need to request both the union and state governments to enhance spending on health, he said the COVID-19 experience will justify an increase in expenditure on health sector.

On the global front, Asian markets were trading mostly in green, after China kept its benchmark loan prime rates unchanged for the seventh consecutive month, as widely expected. The one-year loan prime rate was retained at 3.85 percent and the five-year loan prime rate was maintained at 4.65 percent. The one-year and five-year loan prime rates were last reduced in April. The one-year loan prime rate was lowered by 20 basis points and five-year rate by 10 basis points in April. The loan prime rate is fixed monthly based on the submission of 18 banks, though Beijing has influence over the rate-setting. This new lending rate replaced the central bank's traditional benchmark lending rate in August 2019.

The BSE Sensex is currently trading at 43523.77, down by 76.19 points or 0.17% after trading in a range of 43453.75 and 43889.40. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.43%, while Small cap index was up by 0.14%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.62%, Telecom up by 1.29%, FMCG up by 0.71%, TECK up by 0.64% and IT up by 0.60%, while Energy down by 1.90%, Bankex down by 0.78%, PSU down by 0.50%, Metal down by 0.40% and Oil & Gas down by 0.36% were the top losing indices on BSE.

The top gainers on the Sensex were Bajaj Finserv up by 3.69%, Nestle up by 2.95%, Titan Company up by 2.93%, Tech Mahindra up by 1.70% and HCL Tech up by 1.45%. On the flip side, Indusind Bank down by 2.67%, Reliance Industries down by 2.42%, Axis Bank down by 2.33%, SBI down by 1.84% and ONGC down by 1.66% were the top losers.

Meanwhile, touching highest level in 14 months, the Securities and Exchange Board of India (SEBI) in its latest report showed that investments through participatory notes (P-notes) in the Indian capital market surged to Rs 78,686 crore at October-end, on enhanced global liquidity and measures taken by the government. P-notes are issued by registered foreign portfolio investors (FPIs) to overseas investors who wish to be part of the Indian stock market without registering themselves directly. They, however, need to go through a due diligence process.

According to SEBI data, the value of P-note investments in Indian markets - equity, debt and hybrid securities - increased to Rs 78,686 crore at October-end from Rs 69,821 crore as on September 30. This was the highest level of investment since August 2019, when fund inflow through such route stood at Rs 79,088 crore. Of the total Rs 78,686 crore invested through the route till October, Rs 68,415 crore was invested in equities, Rs 10,047 crore in debt and Rs 224 crore in hybrid securities.

The investment through the route declined in September 2020 after witnessing growth since March. Prior to that, the investment level was at Rs 74,027 crore, Rs 63,228 crore, Rs 62,138 crore, Rs 60,027 crore and Rs 57,100 crore at the end of August, July, June, May and April, respectively. The investment level had fallen to an over 15-year-low of Rs 48,006 crore at the end of March amid significant volatility in broader markets on concerns over the coronavirus-triggered crisis.

The CNX Nifty is currently trading at 12749.10, down by 22.60 points or 0.18% after trading in a range of 12730.25 and 12855.20. There were 28 stocks advancing against 22 stocks declining on the index.

The top gainers on Nifty were Bajaj Finserv up by 3.66%, Titan Company up by 2.86%, Nestle up by 2.80%, Tech Mahindra up by 1.53% and HCL Tech up by 1.37%. On the flip side, Indusind Bank down by 2.80%, Axis Bank down by 2.50%, Reliance Industries down by 2.41%, SBI down by 1.92% and UPL down by 1.92% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 121.24 points or 0.46% to 26,478.21, Straits Times advanced 22.17 points or 0.8% to 2,799.17, Shanghai Composite gained 3.44 points or 0.1% to 3,366.53 and KOSPI rose 3.06 points or 0.12% to 2,550.48. On the flip side, Taiwan Weighted dropped 6.72 points or 0.05% to 13,715.71, Jakarta Composite lost 13.18 points or 0.24% to 5,580.88 and Nikkei 225 slipped 102.27 points or 0.4% to 25,532.07.