Key indices trade flat with negative bias in morning deals

Indian equity benchmarks erased all of their initial gains and were now trading flat with negative bias in morning deals, due to losses in Metal, Basic Materials and Realty stocks. Traders remained cautious with a FICCI's Business Confidence Survey stating that the business sentiment in the country has been deeply impacted due to the second wave of coronavirus infections. It said that the overall business confidence index has nosedived and stood at 51.5 in the current round after reporting a decadal high value of 74.2 in the previous survey round. Some concern also came as the Organisation for Economic Co-operation and Development (OECD) cut its growth projection for India for FY22 to 9.9 per cent from 12.6 per cent estimated in March, as the second wave of coronavirus infections has paused economic recovery in Asia's third largest economy. Traders also took a note of report that the Centre’s fiscal deficit for the financial year 2020-21 settled at 9.2 per cent of the gross domestic product, marginally below the government’s revised target of 9.5 per cent. This was on the back of better-than-expected revenue receipts with expenditure staying broadly at the level targeted in the revised estimates of the Budget.

On the global front, Asian markets were trading mostly in green ahead of European and U.S. data this week that will likely offer clues on the health of the global economy. Back home, on the sectoral front, stocks related to pharma sector remained in focus as the government has given approval to four waitlisted firms under the Production Linked Incentive (PLI) scheme for domestic manufacturing of bulk drugs.

The BSE Sensex is currently trading at 51970.23, up by 32.79 points or 0.06% after trading in a range of 51836.16 and 52228.65. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.13%, while Small cap index was down by 0.20%.

The top gaining sectoral indices on the BSE were Energy up by 0.87%, Oil & Gas up by 0.85%, Consumer Durables up by 0.54%, Capital Goods up by 0.50% and PSU up by 0.47%, while Metal down by 1.93%, Basic Materials down by 0.88%, Realty down by 0.83%, IT down by 0.48% and TECK down by 0.47% were the top losing indices on BSE.

The top gainers on the Sensex were ONGC up by 3.17%, Bajaj Auto up by 2.62%, HDFC up by 1.43%, SBI up by 1.14% and Larsen & Toubro up by 0.93%. On the flip side, Ultratech Cement down by 1.15%, ICICI Bank down by 1.09%, Bajaj Finserv down by 0.90%, Axis Bank down by 0.87% and Infosys down by 0.75% were the top losers.

Meanwhile, emphasising the need for another fiscal package, a FICCI's Business Confidence Survey has said that the business sentiment in the country has been deeply impacted due to the second wave of coronavirus infections. It said that the overall business confidence index has nosedived and stood at 51.5 in the current round after reporting a decadal high value of 74.2 in the previous survey round. There was a ‘sharp deterioration’ in the optimism level of corporate India vis-a-vis the previous survey.

According to the survey, worsening current conditions, as well as muted expectations about the near-term prospects on the back of a sweeping second wave of coronavirus infections, pulled down the overall index value by over 20 points. With household income being severely impacted and past savings are already drawn down during the first wave of infections, demand conditions are expected to remain weak for longer this time around.

On the fiscal side, it said companies unanimously felt the need for another fiscal package, focusing majorly on addressing the demand side. It also suggested that demand boosting measures such as direct income support to rural as well as urban poor, income tax reductions for the middle class, and temporary reductions in indirect taxes must be urgently considered.

The CNX Nifty is currently trading at 15580.60, down by 2.20 points or 0.01% after trading in a range of 15539.70 and 15660.75. There were 23 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were ONGC up by 3.17%, Bajaj Auto up by 2.55%, HDFC up by 1.50%, SBI up by 1.12% and UPL up by 1.06%. On the flip side, Tata Steel down by 2.60%, JSW Steel down by 2.52%, ICICI Bank down by 1.18%, Ultratech Cement down by 1.12% and Bajaj Finserv down by 1.07% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 123.97 points or 0.43% to 29,275.77, Taiwan Weighted strengthened 83.28 points or 0.49% to 17,151.71, KOSPI rose 17.88 points or 0.56% to 3,221.80 and Straits Times advanced 2.71 points or 0.09% to 3,166.99.

On the flip side, Shanghai Composite declined 4.15 points or 0.11% to 3,611.33 and Nikkei 225 slipped 36.40 points or 0.13% to 28,823.68.