Benchmarks trade lower in early deals; Power, Bankex drag

Indian equity benchmarks made cautious start on Friday amid uncertainty about U.S. monetary policy and geopolitical tensions over Afghanistan. Markets lost momentum and slipped below neutral lines in early deals. Domestic indices are trading lower with marginal cut due to selling in Power, Bankex and Utilities stocks. Sentiments got dampened as Moody’s Investors Service said second wave of Covid infections has increased asset risks for Indian banks, but a severe deterioration is unlikely. It said that the second wave of coronavirus infections in India has exacerbated stress among individuals and small businesses that were hit the hardest by the initial outbreak. Adding pessimism, India recorded a spike of 44,558 new Covid-19 cases in the past 24 hours out of which, over 31,000 were from Kerala. Though, downside remained capped as traded took some support as Finance Minister Nirmala Sitharaman discussed with her BRICS counterparts the key areas of cooperation that would be crucial in supporting recovery of the grouping's economies and maintaining macroeconomic stability, while protecting against future uncertainties posed by the COVID-19 pandemic.

On the global front, Asian markets are trading mixed amid the broadly negative cues overnight from Wall Street. Some optimism came amid the global economic recovery ahead of the Fed Chair Jerome Powell's remarks at the Fed's annual Jackson Hole gathering for clues on the timing of a tapering of monetary stimulus. Back home, aviation stocks were in focus as India's air safety regulator said it had cleared Boeing Co's 737 MAX aircraft to fly with immediate effect, ending its nearly two-and-a-half-years of regulatory grounding in a key travel market for Boeing. In scrip specific development, Jindal Poly Films traded higher after it acquired 100 percent shares of Jindal India Solar Energy and consequent thereof Jindal India Solar became wholly owned subsidiary.

The BSE Sensex is currently trading at 55840.29, down by 108.81 points or 0.19% after trading in a range of 55675.87 and 55982.47. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.06%, while Small cap index was up by 0.12%.

The top gaining sectoral indices on the BSE were Metal up by 1.47%, Basic Materials up by 0.95%, Realty up by 0.60%, Telecom up by 0.57%, Capital Goods up by 0.55%, while Power down by 0.92%, Bankex down by 0.45%, Utilities down by 0.44%, Consumer Durables down by 0.36%, IT down by 0.17% were the top losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 1.31%, Sun Pharma up by 1.05%, Tata Steel up by 1.05%, Maruti Suzuki up by 1.02% and Bharti Airtel up by 0.75%. On the flip side, ICICI Bank down by 1.20%, HDFC down by 1.07%, Titan Company down by 0.95%, Bajaj Finserv down by 0.84% and Indusind Bank down by 0.76% were the top losers.

Meanwhile, Finance Minister Nirmala Sitharaman has discussed with her BRICS counterparts the key areas of cooperation that would be crucial in supporting recovery of the grouping's economies and maintaining macroeconomic stability, while protecting against future uncertainties posed by the COVID-19 pandemic.  Sitharaman highlighted that BRICS (Brazil, Russia, India, China and South Africa) has been playing and will continue to play a crucial role in dealing with crises such as the pandemic.

A finance ministry statement said that Sitharaman chaired the second meeting of BRICS Finance Ministers and Central Bank Governors (FMCBG) along with Reserve Bank of India (RBI) Governor Shaktikanta Das under the Indian BRICS Chairship. It said during the meeting, the FMCBGs endorsed the BRICS Finance Ministers and Central Bank Governors Statement on Global Economic Outlook and Responding to COVID-19 Crisis with an annexure on snapshot of policy experiences of member countries in dealing with the economic impact of the pandemic. Sitharaman remarked that India attaches great significance to presenting this statement before the global community since it unanimously voices the view of BRICS countries on the critical aspects underpinning current international policy conversations on post pandemic recovery.

Besides, it said a 'Technical Report on Social Infrastructure: Financing and Use of Digital Technologies' was also endorsed. This report is an exercise towards collaborative knowledge sharing between BRICS economies on social infrastructure, including on how the governments have leveraged digital technologies to enhance access and improve service delivery, especially in the health and education sectors. The BRICS finance ministers also welcomed the conclusion of negotiations on the text of Cooperation and Mutual Administrative Assistance (CMAA) in customs matters, along with deliberating progress made on other customs related issues.

The CNX Nifty is currently trading at 16627.45, down by 9.45 points or 0.06% after trading in a range of 16565.60 and 16655.90. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 2.78%, BPCL up by 1.32%, Larsen & Toubro up by 1.27%, UPL up by 1.22% and Coal India up by 1.06%. On the flip side, ICICI Bank down by 1.16%, HDFC down by 1.02%, Bajaj Finserv down by 0.90%, Titan Company down by 0.88% and Eicher Motors down by 0.83% were the top losers.

Asian markets are trading mixed; Hang Seng rose 137.51 points or 0.54% to 25,553.20, Taiwan Weighted gained 91.29 points or 0.53% to 17,158.25, KOSPI added 4.39 points or 0.14% to 3,132.92 and Shanghai Composite was up by 17.17 points or 0.49% to 3,518.83. On the other hand, Nikkei 225 declined 153.88 points or 0.55% to 27,588.41, Straits Times lost 24.69 points or 0.79% to 3,084.73 and Jakarta Composite fell 19.80 points or 0.33% to 6,038.28.