Weakness persists in Indian markets in morning session

Indian equity benchmarks continued their weak trade in the morning session on account of selling in front line clue chip counters. Traders remain concerned as the International Monetary Fund (IMF) has cut India's gross domestic product (GDP) growth forecast to 9.5 percent for the fiscal year to March 31, 2022 as the onset of a severe second COVID-19 wave cut into recovery momentum. This forecast for 2021-22 is lower than the 12.5 per cent growth in GDP that IMF had projected in April before the second wave took a grip. For 2022-23, it expects economic growth of 8.5 per cent, larger than the 6.9 per cent it had projected in April. Meanwhile, Finance Minister Nirmala Sitharaman informed Parliament that the number of wilful defaulters has increased from 2,208 to 2,494 at the end of March 31, 2021. As per RBI data on global operations, during the last three financial years, public sector banks (PSBs) have effected recovery of Rs 3,12,987 crore in non-performing assets (NPAs) and written-off loans.

On the global front, Asian markets were trading in red amid growing fears about a Chinese government crackdown on tech and education sectors. Back home, on the sectoral front, aviation industry’s stocks remained in focus as the International Air Transport Association (IATA) said the Indian aviation market's recovery has been significantly impacted by caps on fare and capacity that has been placed by the government since May last year.

Back home, The BSE Sensex is currently trading at 52067.78, down by 510.98 points or 0.97% after trading in a range of 52033.20 and 52673.69. There were 5 stocks advancing against 25 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.94%, while Small cap index was down by 1.05%.

The only gaining sectoral index on the BSE was Telecom up by 0.23%, while Utilities down by 1.31%, Realty down by 1.27%, Power down by 1.27%, IT down by 1.20% and Auto down by 1.13% were the top losing indices on BSE.

The top gainers on the Sensex were Titan Co up by 0.99%, Bajaj Finserv up by 0.79%, Indusind Bank up by 0.74%, Hindustan Unilever up by 0.73% and Bharti Airtel up by 0.51%. On the flip side, Dr. Reddy's Lab down by 2.66%, Mahindra & Mahindra down by 1.92%, Axis Bank down by 1.72%, Sun Pharma down by 1.67% and HDFC down by 1.65% were the top losers.

Meanwhile, the International Monetary Fund (IMF) has cut India's gross domestic product (GDP) growth forecast to 9.5 percent for the fiscal year to March 31, 2022 as the onset of a severe second COVID-19 wave cut into recovery momentum. This forecast for 2021-22 is lower than the 12.5 per cent growth in GDP that IMF had projected in April before the second wave took a grip. For 2022-23, it expects economic growth of 8.5 per cent, larger than the 6.9 per cent it had projected in April.

IMF has said that India's economy is gradually recovering from a deep contraction in the fiscal year ended March 31, 2021 (7.3 per cent) and a subsequent severe second wave of COVID-19. It estimates the pandemic has reduced per capita incomes in advanced economies by 2.8 per cent, relative to pre-pandemic trends over 2020-2022, compared with an annual per capita loss of 6.3 per cent a year for emerging market and developing economies (excluding China).

It further said these revisions reflect important extent differences in pandemic developments as the delta variant takes over. Close to 40 percent of the population in advanced economies has been fully vaccinated, compared with 11 percent in emerging market economies, and a tiny fraction in low-income developing countries. It also stated that faster-than expected vaccination rates and return to normalcy have led to upgrades, while lack of access to vaccines and renewed waves of COVID-19 cases in some countries, notably India, have led to downgrades.

The CNX Nifty is currently trading at 15595.50, down by 150.95 points or 0.96% after trading in a range of 15583.25 and 15767.50. There were 7 stocks advancing against 43 stocks declining on the index.

The top gainers on Nifty were Divi's Lab up by 1.22%, Titan Company up by 1.03%, Indusind Bank up by 0.84%, Bajaj Finserv up by 0.79% and Hindustan Unilever up by 0.79%. On the flip side, Dr. Reddy's Lab down by 2.97%, Tata Consumer Product down by 2.73%, Cipla down by 2.09%, Tata Motors down by 2.01% and Sun Pharma down by 1.95% were the top losers.

Asian markets were trading in red; Nikkei 225 slipped 471.63 points or 1.69% to 27,498.59, KOSPI fell 20.84 points or 0.64% to 3,211.69, Straits Times trembled 7.80 points or 0.25% to 3,131.01, Shanghai Composite declined 20.10 points or 0.59% to 3,361.08, Jakarta Composite lost 9.28 points or 0.15% to 6,087.77, Taiwan Weighted dropped 248.50 points or 1.44% to 17,021.37 and Hang Seng decreased 59.27 points or 0.24% to 25,027.16.