Domestic indices extend previous session’s losses with negative start

Indian equity benchmarks extended their previous session’s losses and made negative start on last trading day of week amid mixed global cues. Markets are trading in red with cut of over half a percent each in early deals due to selling in Utilities, Power and Energy stocks. Some cautiousness crept in the markets as the Centre extended the nationwide Covid-19 containment measures till November 30 as there has been localised spread of the virus in a few states and the disease continues to be a public health challenge in the country. Though, downside remained capped as buying in Metal, Realty and Basic Materials aided sentiments. Some support came in as painting a rosy picture of the economy, the city-based thinktank NCAER said that most of the sectors are on their way to reach pre-pandemic levels and surpass them. The National Council for Applied Economic Research (NCAER) said the economic news has been favourable on balance, on account of better than projected fiscal outcomes, a rebound in most high-frequency indicators, and another impetus to policy reform, including a hitherto inconceivable privatisation of Air India.

On the global front, Asian markets traded mixed as traders reacted to disappointing earnings tech giants Apple and Amazon as well as policy announcements from the Bank of Canada and the Bank of Japan. Traders are also concerned that high inflation may force global central banks to tighten monetary policy earlier than thought. Back home, gold and jewelry industry stocks were in focus as the World Gold Council said India’s gold demand has seen a 47 per cent year-on-year jump in the July-September quarter to 139.1 tonnes, following strong rebound in economic activity and recovering consumer demand. In scrip specific development, IRCTC traded under pressure after the Railway Minister asked the company to share 50 per cent of the convenience fee on train tickets with the ministry. However, DLF traded higher as it reported a 66 per cent YoY increase in consolidated net profit at Rs 378.12 crore for the quarter ended September.

The BSE Sensex is currently trading at 59573.41, down by 411.29 points or 0.69% after trading in a range of 59104.58 and 59865.21. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 0.36%, while Small cap index was down by 0.54%.

The top gaining sectoral indices on the BSE were Metal up by 0.88%, Realty up by 0.88%, Basic Materials up by 0.41%, Consumer Durables up by 0.17%, Telecom up by 0.13%, while Utilities down by 1.41%, Power down by 1.35%, Energy down by 1.16%, Bankex down by 1.04%, PSU down by 0.83% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 1.50%, Titan Company up by 1.14%, ITC up by 0.87%, Ultratech Cement up by 0.74% and HCL Technologies up by 0.55%. On the flip side, HDFC down by 3.10%, Indusind Bank down by 2.46%, Kotak Mahindra Bank down by 1.66%, Reliance Industries down by 1.59% and NTPC down by 1.56% were the top losers.

Meanwhile, the city-based think-tank -- the National Council for Applied Economic Research (NCAER) in its monthly review of the economy painted a rosy picture of the economy and has said that most of the sectors are on their way to reach pre-pandemic levels and surpass them. It said ‘The economic news has been favourable on balance, on account of better than projected fiscal outcomes, a rebound in most high-frequency indicators, and another impetus to policy reform, including a hitherto inconceivable privatisation of Air India’. It added that the economic activity has continued to normalise with increase in vaccinations and decline in the incidence of COVID infections.

The report said ‘With the economy expected to grow at 9.5 per cent (RBI) this year, most sectors seem to be on their way to reach the pre-pandemic level and then grow beyond those levels’. While the agriculture sector, which remained mostly undented by COVID, has continued to grow at its long-term average, the manufacturing sector seemed to be on target to recoup most of the loss that it had suffered during the pandemic. It said being the most contact-intensive, the service sector was the hardest hit by the pandemic, and is understandably the slowest to recover.

It further said the domestic policy imperatives include putting the fiscal policy on a more sustainable path, being watchful of the impact of the COVID-related economic stress on the asset quality of banks and non-banking financial institutions (NBFIs), better understanding and alleviating the constraints to private investment, and further leveraging the buoyancy in the global trade outlook. It added ‘Even as the domestic economic environment has been stabilising, the global economic environment seems to be facing specific headwinds, which may have implications for the Indian economy’. The report flags rising inflation on account of the generous fiscal stimulus in some of the advanced economies such as the US, supply chain bottlenecks, and rising energy prices; an impending tightening of monetary policy in advanced economies; and the seemingly irrational exuberance in the capital markets.

The CNX Nifty is currently trading at 17740.35, down by 116.90 points or 0.65% after trading in a range of 17613.10 and 17833.40. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Adani Ports & SEZ up by 1.85%, Tata Steel up by 1.42%, JSW Steel up by 1.36%, Titan Company up by 0.92% and ITC up by 0.91%. On the flip side, HDFC down by 3.13%, Indusind Bank down by 2.46%, Kotak Mahindra Bank down by 1.61%, Reliance Industries down by 1.56% and Axis Bank down by 1.56% were the top losers.

Asian markets are trading mixed; Nikkei 225 rose 93.41 points or 0.32% to 28,913.50, Straits Times jumped 21.15 points or 0.66% to 3,224.97, Jakarta Composite surged 44.02 points or 0.67% to 6,568.10 and Shanghai Composite was up by 5.52 points or 0.16% to 3,523.94. On the other hand, Hang Seng fell 104.18 points or 0.41% to 25,451.55, Taiwan Weighted lost 59.02 points or 0.35% to 16,982.61 and KOSPI declined 18.58 points or 0.62% to 2,990.97.