Sensex, Nifty trade in red during late morning deals

Indian equity benchmarks were trading in red terrain during late morning deals, with both Sensex and Nifty below their neutral lines, despite positive cues from other Asian markets. Domestic sentiments got hit, after India's manufacturing sector activity witnessed a significant loss of growth momentum in May due to the intensification of the COVID-19 crisis and its detrimental impact on demand. The seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index (PMI), fell to 50.8 in May, down from 55.5 in April, as companies observed the slowest rises in new work and output in ten months amid the intensification of the COVID-19 crisis. Traders ignored reports that Moody’s Investors Service pegged India's GDP growth at 9.3 per cent in the current fiscal ending March 2022 and 7.9 per cent in FY23.

On the global front, Asian markets were trading mostly in green, after Malaysia's producer prices increased in April. The figures from the Department of Statistics showed that the producer price index rose 10.6 percent year-on-year in April, following a 6.7 percent increase in March. Among sectors, prices of mining increased the most by 92.4 percent annually in April and prices for agriculture, forestry and fishing grew 49.8 percent.

The BSE Sensex is currently trading at 51813.47, down by 123.97 points or 0.24% after trading in a range of 51809.68 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 was down by 0.70%, while Small cap index was down by 0.65%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 0.51%, Oil & Gas up by 0.44%, Energy up by 0.28% and FMCG up by 0.04%, while Metal down by 2.70%, Basic Materials down by 1.64%, Realty down by 1.41%, Bankex down by 0.82% and Telecom down by 0.81% were the top losing indices on BSE.

The top gainers on the Sensex were ONGC up by 3.26%, Bajaj Auto up by 1.55%, Bajaj Finance up by 0.99%, HDFC up by 0.84% and SBI up by 0.65%. On the flip side, Ultratech Cement down by 2.18%, ICICI Bank down by 1.63%, Bajaj Finserv down by 1.19%, Axis Bank down by 1.13% and Kotak Mahindra Bank down by 0.82% were the top losers.

Meanwhile, India's economy contracted by less-than-expected 7.3 per cent in the fiscal year ended March 2021 after growth rate picked up in the fourth quarter, just before the world's worst outbreak of coronavirus infections hit the country. The gross domestic product (GDP) in Asia's third-largest economy grew by 1.6 per cent in the January-March period, up from 0.5 per cent in the previous quarter when India began pulling out of a steep pandemic-induced recession in the earlier six months. GDP had grown by 3 per cent in the January-March quarter in the previous year.

The economy, which was facing a slowdown even before the pandemic broke out last year, contracted by 7.3 per cent during April 2020 to March 2021 fiscal (FY21), weighed down by a nationwide lockdown that pummelled consumption and halted most economic activities. This is the first full-year contraction in the Indian economy in the last four decades since 1979-80, when GDP had shrunk by 5.2 per cent. The economy had grown by 4 per cent in the previous 2019-20 fiscal. Prior to that, the GDP expanded by 8.3 per cent in FY17 before slipping to 7 per cent in the following fiscal and to 6.1 per cent in 2018-19.

According to data released by the National Statistical Office (NSO), India's real GDP contracted to Rs 135 lakh crore in FY21 (2020-21) from Rs 145 lakh crore at the end of March 2020. According to data, gross value added (GVA) growth in the manufacturing sector accelerated to 6.9 per cent in the fourth quarter of 2020-21 compared to a contraction 4.2 per cent a year ago. GDP at Constant (2011-12) Prices in Q4 of 2020-21 is estimated at Rs 38.96 lakh crore, as against Rs 38.33 lakh crore in Q4 of 2019-20, showing a growth of 1.6 percent.

The CNX Nifty is currently trading at 15534.65, down by 48.15 points or 0.31% after trading in a range of 15528.30 and 15660.75. There were 17 stocks advancing against 32 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were ONGC up by 3.21%, Bajaj Auto up by 1.47%, HDFC up by 0.87%, Bajaj Finance up by 0.80% and Wipro up by 0.68%. On the flip side, Tata Steel down by 3.34%, JSW Steel down by 3.06%, Ultratech Cement down by 2.18%, Grasim Industries down by 2.14% and Hindalco down by 1.75% 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.