Benchmarks witness considerable losses in late afternoon session

The Indian equity benchmarks witnessed considerable losses in late afternoon session, with Sensex and Nifty falling above 1100 and 250 points, respectively. Capital Goods, PSU and Utilities counters were on the priority list of the sellers. Sentiments remained down-beat after Maharashtra Chief Minister Uddhav Thackeray said that a strict lockdown could be implemented in the state and Mumbai if people don't follow discipline. Thackeray said that imposing a lockdown is necessary to cut the chain of the COVID-19 infection and added that districts have been told to impose restrictions as required from February 22. Traders overlooked foreign portfolio investors (FPIs) invested Rs 24,965 crore in Indian markets in February so far as various organisations predicted high economic growth for the country and the Union Budget boosted investors’ sentiment. On the global front, Asian markets were trading mixed with Japan's benchmark rising but others slipping, amid some hopes for a recovery from the coronavirus pandemic with the global rollout of vaccines. European markets were trading lower amid cautious trade in global markets.

The BSE Sensex is currently trading at 49756.80, down by 1132.96 points or 2.23% after trading in a range of 49752.89 and 50986.03. There were 2 stocks advancing against 28 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index declined 1.65%, while Small cap index was down by 1.10%.

The only gaining sectoral indices on the BSE were Metal up by 2.45% and Basic Materials was up by 0.18%, while Capital Goods down by 2.45%, PSU down by 2.37%, Utilities down by 2.37%, Realty down by 2.36% and IT was down by 2.34% were the top losing indices on BSE.

The top gainers on the Sensex were ONGC up by 1.90% and HDFC Bank up by 0.32%. On the flip side, Mahindra & Mahindra down by 4.75%, Dr. Reddys Lab down by 4.21%, ITC down by 4.12%, Tech Mahindra down by 4.00% and Indusind Bank down by 3.84% were the top losers.

Meanwhile, in order to meet the GST compensation shortfall, the Ministry of Finance, Department of Expenditure has released the 17th weekly instalment of Rs 5,000 crore to the States. Out of this, an amount of Rs 4,730.41 crore has been released to 23 States and an amount of Rs 269.59 crore has been released to the 3 Union Territories (UT) with Legislative Assembly (Delhi, Jammu & Kashmir & Puducherry) who are members of the GST Council. The remaining 5 States, Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim do not have a gap in revenue on account of GST implementation.

The amount released this week was the 17th instalment of such funds provided to the States. The amount has been borrowed this week at an interest rate of 5.5924%. So far, an amount of Rs 1,00,000 crore has been borrowed by the Central Government through the special borrowing window at an average interest rate of 4.8307%.

In addition to providing funds through the special borrowing window to meet the shortfall in revenue on account of GST implementation, the Government of India has also granted additional borrowing permission equivalent to 0.50% of Gross States Domestic Product (GSDP) to the states choosing Option-I to meet GST compensation shortfall to help them in mobilising additional financial resources. All the States have given their preference for Option-I.

The CNX Nifty is currently trading at 14684.15, down by 297.60 points or 1.99% after trading in a range of 14681.30 and 15010.10. There were 9 stocks advancing against 41 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 3.57%, JSW Steel up by 2.81%, Tata Steel up by 2.27%, ONGC up by 1.90% and Britannia up by 0.71%. On the flip side, Mahindra & Mahindra down by 5.04%, Dr. Reddys Lab down by 4.11%, ITC down by 4.08%, Tech Mahindra down by 3.94% and Larsen & Toubro down by 3.86% were the top losers.

Asian markets were trading mixed, Nikkei 225 surged 138.11 points or 0.46% to 30,156.03, Taiwan Weighted strengthened 68.78 points or 0.42% to 16,410.16, Jakarta Composite soared 23.38 points or 0.38% to 6,255.31 and Straits Times was up by 0.85 points or 0.03% to 2,881.49. On the flip side, KOSPI fell 27.87 points or 0.9% to 3,079.75, Shanghai Composite declined 53.73 points or 1.45% to 3,642.44 and Hang Seng was down by 324.90 points or 1.06% to 30,319.83.

European markets were trading lower, UK’s FTSE 100 decreased 64.92 points or 0.98% to 6,559.10, France’s CAC decreased 63.55 points or 1.1% to 5,710.00 and Germany’s DAX was down by 187.41 points or 1.34% to 13,805.82.