Benchmarks continue lackluster trade slightly in red

Indian equity benchmarks continued their lackluster trade slightly in red in morning session, despite positive cues from global markets. Investors’ sentiment remain dented with the 'Quarterly Statistics on Deposits and Credit of Scheduled Commercial Banks (SCBs), September 2020' - released by the Reserve Bank of India (RBI) has indicated that bank credit growth decelerated to 5.8 percent in Q2 (July- September) of FY21 from 8.9 percent in the year-ago period. It also said aggregate deposits of banks rose 11 percent year-on-year in the July-September period as compared to 10.1 percent growth a year ago. Traders also took a note of report that the Finance Ministry has asked ministries and departments to restrict their expenditure for the remaining months of the current fiscal as per the Revised Estimates (RE) target, amid moderating revenues due to the COVID-19 crisis. However, losses were limited as traders found some support with a private report stating that the Indian economy is likely to have improved in the second quarter with GDP printing in at -7.8 percent as against 24 percent contraction in the June quarter.

On the global front, Asian markets were trading mostly in green, as investors' risk appetite remained strong amid optimism about the economic recovery due to recent positive coronavirus vaccine news. Back home, on the sectoral front, Metal stocks were in focus with World Steel Association (worldsteel) report that India's crude steel output increased marginally by 0.9 per cent to 9.058 million tonne (MT) in October 2020.

The BSE Sensex is currently trading at 43775.64, down by 52.46 points or 0.12% after trading in a range of 43655.60 and 44023.26. There were 13 stocks advancing against 16 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index rose 0.04%, while Small cap index was down by 0.02%.

The top gaining sectoral indices on the BSE were Telecom up by 0.52%, Capital Goods up by 0.44%, Consumer Durables up by 0.36%, Healthcare up by 0.34% and Industrials up by 0.21%, while IT down by 0.76%, Oil & Gas down by 0.60%, TECK down by 0.59%, Auto down by 0.46% and Energy down by 0.33% were the top losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 1.10%, Bajaj Finance up by 1.06%, Tata Steel up by 0.92%, Titan Company up by 0.79% and Larsen & Toubro up by 0.74%. On the flip side, Maruti Suzuki down by 1.60%, Infosys down by 1.45%, Indusind Bank down by 1.29%, Tech Mahindra down by 1.14% and Asian Paints down by 1.02% were the top losers.

Meanwhile, the Union Cabinet has approved the government’s capital infusion of Rs 6,000 crore in the National Investment and Infrastructure Fund (NIIF) over two years. Union minister of information and broadcasting -- Prakash Javadekar has said under the NIIF, two firms, Aseem Infrastructure Finance Limited (AIFL) and NIIF Infrastructure Finance Limited (NIIF-IFL) will mobilise the funds.

While AIFL will finance under construction green field and brown field projects with less than a year of operations, NIIF-IFL will finance mature operating assets by helping infrastructure investors to replace high cost bank finance with cheaper finance post-commissioning. The Centre, who’s investment will go into the NIIF’s strategic opportunities fund, has allocated Rs 2,000 crore for the current fiscal.

However, in view of the unprecedented financial situation and availability of limited fiscal space due to the prevailing Covid-19, the proposed amount may be disbursed only if there is readiness and demand for debt raising. Besides, Javadekar said NIIF-IFL is a AAA rated company while AIFL was AA rated. The NIIF debt platform will put in Rs 7,000 crore equity while about Rs 1 lakh crore will be mobilised through global bond markets to make Rs 1.1 lakh crore available for infrastructure projects in the first tranche.

The CNX Nifty is currently trading at 12844.80, down by 13.60 points or 0.11% after trading in a range of 12805.20 and 12916.75. There were 25 stocks advancing against 25 stocks declining on the index.

The top gainers on Nifty were Grasim Industries up by 1.90%, Mahindra & Mahindra up by 1.21%, Bajaj Finance up by 1.16%, Divis Lab up by 1.11% and Adani Ports &SEZ up by 1.07%. On the flip side, Eicher Motors down by 2.00%, Maruti Suzuki down by 1.68%, Indusind Bank down by 1.42%, Infosys down by 1.41% and Tech Mahindra down by 1.29% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 186.91 points or 0.71% to 26,483.77, Taiwan Weighted strengthened 89.18 points or 0.65% to 13,828.01, Hang Seng increased 46.80 points or 0.18% to 26,716.55, Jakarta Composite soared 39.47 points or 0.69% to 5,718.72 and KOSPI rose 14.60 points or 0.56% to 2,616.14.

On the flip side, Shanghai Composite declined 4.32 points or 0.13% to 3,358.01 and Straits Times trembled 20.79 points or 0.72% to 2,848.76.