Domestic indices trade lower in early deals after slightly positive start

Indian equity benchmarks made flat-to-positive start on Thursday tracking overnight gains on Wall Street. But, soon markets slipped below neutral lines amid muted trend in Asian peers. Markets are trading lower in early deals with marginal cut due to selling in Bankex, Metal and Basic Materials counters. There was some volatility in the markets ahead of the expiry of May series derivative contracts later in the day. sentiments got dented as rating agency Crisil in its research report said higher input prices and disruptions to the rural economy have resulted in price pressures and inflation is back to haunt us. The report by Crisil said it sees upside risks to its 5 per cent estimate on consumer price inflation in FY21 because of this. Besides, India recorded over 211,000 new Covid infections, while deaths from the disease rose by 3,842. However, down side remained capped with private report that the government may at the beginning of the unlock phase announce another stimulus package for the most hit sectors such as small business and self-employed, with the world's worst pandemic outbreak scarring nascent economic recovery.

On the global front, Asian markets were trading mixed following the positive cues overnight from Wall Street on continued economic optimism as the country continues to reopen following the coronavirus pandemic. Buying interest remained subdued as traders look ahead to Friday's closely watched inflation reading, which could directly affect the current levels of stimulus. Traders are also cautious and refraining from making major moves amid the continued surge in coronavirus cases in most markets in the region, particularly in India and Japan.

Back home, two and three wheeler industry stocks were in focus as ratings agency ICRA said the electric two and three-wheelers volume are expected to account for 8-10 per cent and 30 per cent of new vehicle sales in the country by 2025, respectively, owing to low operating cost and attractive subsidy support, among others. In scrip specific development, V-Guard surged on posting a 112 percent year-on-year (YoY) rise in its Q4 consolidated net profit. BPCL shares were up as it reported an over four-fold rise in standalone profit for the March quarter.

The BSE Sensex is currently trading at 50957.15, down by 60.37 points or 0.12% after trading in a range of 50917.59 and 51128.80. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.09%, while Small cap index was up by 0.26%.

The top gaining sectoral indices on the BSE were IT up by 1.08%, TECK up by 0.90%, Consumer Durables up by 0.64%, Auto up by 0.35%, Utilities up by 0.31%, while Bankex down by 0.32%, Metal down by 0.24%, Basic Materials down by 0.10%, Capital Goods down by 0.10%, Healthcare down by 0.06% were the top losing indices on BSE.

The top gainers on the Sensex were Tech Mahindra up by 2.43%, TCS up by 1.50%, Infosys up by 1.06%, Ultratech Cement up by 0.94% and HCL Technologies up by 0.93%. On the flip side, Bajaj Finance down by 1.44%, Bajaj Finserv down by 1.13%, Hindustan Unilever down by 0.89%, Indusind Bank down by 0.86% and Asian Paints down by 0.73% were the top losers.

Meanwhile, ratings agency ICRA has said the electric two and three-wheelers volume are expected to account for 8-10 per cent and 30 per cent of new vehicle sales in the country by 2025, respectively, due to low operating cost and attractive subsidy support, among others. It said the penetration levels in cars and trucks, however, are likely to remain low in the medium-term. Electric two-wheeler (2W) and three-wheeler (3W) segments have relatively lower dependency on commercial charging infrastructure, owing to limited span of commute and can also adopt battery swapping to allay charging related concern for commercial applications.

Further, it mentioned, globally, EVs now account for 4.4 per cent of new car sales during CY2020 and their share is likely to cross 5 per cent level this calendar year. Furthermore, it stated operating cost metrices continue to favour electric 2W and 3W for commercial operations. In fact, e3W over life of the vehicle will be much more cost economical than its CNG counterparts.

It noted India can capitalise on its vast 2W and 3W segment, to emerge as leading manufacturer of e2W and e3W, globally. However, it will continue to lag in electric car segment. It said while global automotive demand declined during CY2020 due to COVID-19-related impact, EVs remained the bright spot with approximately 40 per cent growth over the previous years. Agency said it believes that while the transition to EVs is inevitable, the pace of penetration will be relatively gradual in India unlike global markets like China, Europe, and the US.

The CNX Nifty is currently trading at 15294.35, down by 7.10 points or 0.05% after trading in a range of 15278.60 and 15335.55. There were 20 stocks advancing against 30 stocks declining on the index.

The top gainers on Nifty were Tech Mahindra up by 2.35%, Wipro up by 2.13%, Tata Motors up by 1.79%, TCS up by 1.50% and Infosys up by 1.09%. On the flip side, Bajaj Finance down by 1.43%, Bajaj Finserv down by 1.10%, Hindustan Unilever down by 0.92%, Indusind Bank down by 0.92% and Grasim Industries down by 0.73% were the top losers.

Asian markets were trading mixed; Nikkei 225 declined 142.28 points or 0.50% to 28,499.91, Hang Seng fell 79.37 points or 0.27% to 29,086.64, Taiwan Weighted slipped 73.31 points or 0.44% to 16,570.38 and KOSPI lost 7.70 points or 0.24% to 3,160.73. On the other hand, Straits Times rose 10.41 points or 0.33% to 3,156.50, Jakarta Composite added 68.58 points or 1.18% to 5,884.42 and Shanghai Composite was up by 6.45 points or 0.18% to 3,599.81.