Markets continue to trade in red in morning deals

Indian equity benchmarks continued to trade in red in the morning session amid heavy selling witnessed in frontline blue-chip stocks. Sentiments remained down-beat as Former RBI Governor D Subbarao expressed concerns over ‘extreme unevenness’ in economic recovery and ‘sharpening inequalities’ between upper-income segments and lower-income households in the country, cautioning that the trend will hit growth prospects going forward. Terming the uneven recovery ‘morally wrong and politically corrosive’ he said liquidity in the domestic market and foreign fund inflows are leading to soaring prices of stocks and other assets despite disruptions due to the Covid pandemic. Traders took note of NITI Aayog CEO Amitabh Kant’s statement that it will not be business as usual after the COVID-19 pandemic and we need to bring more simplicity in the ease of doing business by doing away with the current maze of rules. On the global front, Asian markets were trading mostly in green following the broadly positive cues from Wall Street on Friday. Investors looking forward to the Federal Reserve's next meeting this week hoping for fresh clues about monetary policy in light of the US economy's blistering recovery.

The BSE Sensex is currently trading at 52261.26, down by 213.50 points or 0.41% after trading in a range of 51936.31 and 52542.66. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 1.83%, while Small cap index was down by 0.78%.

The top gaining sectoral indices on the BSE were IT up by 0.48% and TECK up by 0.24% while, Industrials down by 3.11%, Power down by 2.51%, Utilities down by 1.62%, Realty down by 1.61% and Telecom down by 1.29% were the losing indices on BSE.

The top gainers on the Sensex were ONGC up by 1.34%, Infosys up by 0.94%, Bajaj Finance up by 0.85%, TCS up by 0.46% and Tech Mahindra up by 0.32%. On the flip side, SBI down by 1.39%, HDFC down by 1.36%, Kotak Mahindra Bank down by 1.21%, Maruti Suzuki down by 1.20% and ICICI Bank down by 1.09% were the top losers.

Meanwhile, Former RBI Governor D Subbarao has expressed concerns over ‘extreme unevenness’ in economic recovery and ‘sharpening inequalities’ between upper-income segments and lower-income households in the country, cautioning that the trend will hit growth prospects going forward. Terming the uneven recovery ‘morally wrong and politically corrosive’ he said liquidity in the domestic market and foreign fund inflows are leading to soaring prices of stocks and other assets despite disruptions due to the Covid pandemic.

The ex-central bank governor further said that earlier expectations of a sharp economic recovery this year have been dashed by the new pandemic wave. He noted that the economy contracted last year, for the first time in four decades, by as much as 7.3 percent. That was less deep than we had first feared but still deep enough to have caused distress to millions of families in the informal sector. He added that there was the expectation of a sharp recovery this year but those expectations are now tempered by the impact of the second wave.

The former RBI chief further said the RBI too reduced its growth forecast for the current fiscal by one percentage point, from 10.5 percent to 9.5 percent, and added that even 9.5 percent growth might seem impressive but note that this is coming on a very low base of last year. He said ‘even if we clock this growth rate, the output during this fiscal 2021/22 will still be less than the output two years ago before the pandemic hit us. Compare that with China which never fell below its pre-pandemic level and the US which is expected to recover to its pre-pandemic level this year.’

The CNX Nifty is currently trading at 15720.60, down by 78.75 points or 0.50% after trading in a range of 15606.50 and 15791.90. There were 16 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were ONGC up by 1.58%, Bajaj Finance up by 1.14%, Tata Steel up by 1.01%, Wipro up by 0.91% and Divis Lab up by 0.84%. On the flip side, Adani Ports &SEZ down by 15.27%, Coal India down by 1.60%, UPL down by 1.39%, HDFC down by 1.36% and SBI down by 1.33% were the top losers.

Asian markets were trading mostly in green; KOSPI rose 1.82 points or 0.06% to 3,251.14, Nikkei 225 surged 173.87 points or 0.6% to 29,122.60 and Jakarta Composite soared 5.64 points or 0.09% to 6,101.14.  On the flip side, Straits Times trembled 1.99 points or 0.06% to 3,155.98.