Benchmark indices trade lower in early deals; Bankex, Telecom drag

Indian equity benchmarks made negative start on Wednesday tracking lackluster cues from global markets. Domestic indices are trading slightly lower in early deals due to selling in Bankex, Telecom and Realty stocks. Sentiments got dented with rising coronavirus cases in the country. India has recorded a spike of 40,215 fresh Covid-19 cases in the last 24 hours, taking the total caseload to 30,944,949, according to Worldometer. The death count increased to 411,439 with 623 new fatalities, the data showed. Traders took note of report that global rating agency Standard and Poor’s has affirmed India’s sovereign rating at BBB- and maintained a stable outlook on gradual recovery in the economy. It said India’s recovery will gather pace through the second half of FY22 and into the following year, helping to stabilise the country’s overall credit profile. Investors are eyeing the WPI data to be out later in the day.

On the global front, most of the Asian markets were trading lower following the broadly negative cues overnight from Wall Street, after data showed US consumer inflation surprisingly accelerated at the fastest pace in thirteen years in June. Traders also remain concerned amid the accelerating infection rates of the highly contagious delta variant of the coronavirus in several parts of the world over the last few weeks. Back home, infrastructure industry stocks were in focus as Union Road Transport and Highways Minister Nitin Gadkari said the construction of roads was faster than ever. In scrip specific development, Mindtree traded higher as it reported net profit at Rs 343.4 crore for the quarter ended June 30, 2021, an increase of 61.2 per cent year-on-year, and sequentially profits grew 8.2 per cent.

The BSE Sensex is currently trading at 52672.73, down by 97.00 points or 0.18% after trading in a range of 52624.85 and 52801.44. There were 10 stocks advancing against 20 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.20%, while Small cap index was up by 0.42%.

The top gaining sectoral indices on the BSE were Capital Goods up by 0.70%, IT up by 0.56%, Power up by 0.50%, TECK up by 0.37%, Industrials up by 0.34%, while Bankex down by 0.47%, Telecom down by 0.41%, Realty down by 0.28%, FMCG down by 0.25%, Auto down by 0.23% were the top losing indices on BSE.

The top gainers on the Sensex were Tech Mahindra up by 1.96%, Larsen & Toubro up by 1.20%, HCL Technologies up by 0.75%, Power Grid Corp up by 0.50% and NTPC up by 0.46%. On the flip side, Maruti Suzuki down by 0.77%, HDFC down by 0.70%, ICICI Bank down by 0.59%, Ultratech Cement down by 0.53% and Nestle down by 0.47% were the top losers.

Meanwhile, rating agency Icra has said demand for electricity in India is expected to grow 6 per cent in current financial year (FY22) as compared to the previous fiscal year. It has also estimated power generation capacity addition at 17- 18 GW for the ongoing fiscal year. It has estimated the all India electricity demand growth at 6.0 per cent for FY2022 on a year-on-year (YoY) basis, considering the favourable base effect, relatively lesser impact of the second wave on electricity demand and the pick-up in the vaccination programme.

It said the electricity demand slowed down during the first two months of 2021-22 compared to March 2021 amid lockdowns imposed by state governments to control the second wave of COVID-19. Nonetheless, , it stated with the slowdown in fresh COVID-19 infections from the second half of May 2021, state governments eased lockdown restrictions and this in turn improved the electricity demand growth prospects as seen in June 2021, with a month-on-month growth of 3.9 per cent.

However, it added that any resurgence in infections leading to lockdown restrictions would remain a key downside risk for the demand. Further, Icra said it expects the all-India power generation capacity addition to rebound to 17-18 GW in the year, increasing by 45 per cent YoY from 12.8 GW in 2020-21, mainly led by the renewable energy (RE) segment backed by a strong pipeline of 38 GW projects under development.

The CNX Nifty is currently trading at 15784.85, down by 27.50 points or 0.17% after trading in a range of 15768.40 and 15811.70. There were 18 stocks advancing against 31 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Tech Mahindra up by 2.16%, Larsen & Toubro up by 1.26%, HCL Technologies up by 1.03%, ONGC up by 0.91% and Coal India up by 0.68%. On the flip side, UPL down by 1.26%, HDFC down by 0.81%, Maruti Suzuki down by 0.80%, ICICI Bank down by 0.71% and Nestle down by 0.71% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 declined 61.81 points or 0.22% to 28,656.43, Straits Times fell 7.16 points or 0.23% to 3,159.65, Hang Seng slipped 178.34 points or 0.64% to 27,785.07, KOSPI lost 8.89 points or 0.27% to 3,262.49, Jakarta Composite plunged 44.27 points or 0.74% to 5,967.76 and Shanghai Composite was down by 29.26 points or 0.82% to 3,537.26, while Taiwan Weighted added 19.59 points or 0.11% to 17,867.11.