Volatile trade continues over Dalal Street

Volatile trade continued over the Dalal Street in late morning session, with both Sensex and Nifty trading in red terrain. Negative cues from other Asian markets impacted domestic sentiments. Traders got cautious, as Sebi proposed putting a cap on IPO proceeds earmarked for making future acquisitions without identifying specific targets and monitoring funds reserved for general corporate purposes. Besides, Fitch Ratings has kept India's sovereign rating unchanged at 'BBB-' with a negative outlook. It stated that the rating balances a still-strong medium-term growth outlook and external resilience from solid foreign-reserve buffers against high public debt, a weak financial sector and some lagging structural issues.

On the global front, Asian markets were trading mostly in red, after Japan posted a merchandise trade deficit of 67.370 billion yen in October, the Ministry of Finance said on Wednesday. That exceeded expectations for a shortfall of 310 billion following the downwardly revised 624.1 billion yen deficit in September (originally a deficit of 622.8 billion yen).

The BSE Sensex is currently trading at 60297.23, down by 25.14 points or 0.04% after trading in a range of 60029.21 and 60426.61. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.21%, while Small cap index was up by 0.65%.

The top gaining sectoral indices on the BSE were Power up by 1.78%, Utilities up by 1.37%, Healthcare up by 0.76%, Auto up by 0.52% and Capital Goods up by 0.51%, while Energy down by 0.85%, Telecom down by 0.84%, Realty down by 0.73%, Oil & Gas down by 0.70% and Basic Materials down by 0.38% were the top losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 2.86%, Asian Paints up by 2.35%, NTPC up by 1.71%, Indusind Bank up by 1.50% and Bajaj Finance up by 1.48%. On the flip side, Bharti Airtel down by 1.29%, Axis Bank down by 1.14%, Dr. Reddy's Lab down by 0.98%, Reliance Industries down by 0.87% and Tata Steel down by 0.63% were the top losers.

Meanwhile, Reserve Bank Governor Shaktikanta Das has said that numerous macro indicators suggest that the economic recovery is now taking hold after the beating it has taken during the pandemic, but for growth to be sustainable and reach its potential, private capital investment has to resume. He said the economy has the potential to grow at a reasonably high pace in the post-pandemic scenario, provided private capital investment resumes.

The governor asked banks to be investment-ready when the investment cycle picks up, which the RBI feels to begin from the next fiscal. It can be noted that since 2013, private capital has been missing from the economy and many are of the view that this should begin from mid-next fiscal.

Even though he took solace in the fast-improving balance sheets of banks, the governor said gross bad loans of banks have come down in the September quarter from the previous quarter. He also asked banks to improve their capital management process. Lauding the tech entrepreneurs, he said the country has emerged as a top performer in the startup landscape, attracting billions of foreign capital.

The CNX Nifty is currently trading at 17980.00, down by 19.20 points or 0.11% after trading in a range of 17906.60 and 18022.65. There were 22 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were SBI Life Insurance up by 3.24%, Power Grid up by 2.64%, Tata Motors up by 2.40%, Asian Paints up by 2.34% and NTPC up by 1.64%. On the flip side, UPL down by 2.89%, Grasim Industries down by 1.49%, Bharti Airtel down by 1.27%, Divi's Lab down by 1.24% and Adani Ports & SEZ down by 1.22% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 118.59 points or 0.46% to 25,595.19, Nikkei 225 slipped 79.61 points or 0.27% to 29,728.51, KOSPI fell 27.59 points or 0.92% to 2,969.62 and Straits Times trembled 9.55 points or 0.29% to 3,229.25. On the flip side, Shanghai Composite gained 7.47 points or 0.21% to 3,529.26, Jakarta Composite soared 9.33 points or 0.14% to 6,660.54 and Taiwan Weighted strengthened 24.30 points or 0.14% to 17,717.43.