Benchmarks continue to trade on negative note

Indian equity benchmarks continued to trade on a negative note in morning deals, tracking weakness across most global markets. Traders remained cautious as foreign institutional investors (FIIs) net sold shares worth Rs 3,438.76 crore in the Indian equity market on November 22. Some cautiousness also came with Crisil ratings report that the demand growth for petrol and diesel is going to be severely impacted due to push towards compressed natural gas (CNG), ethanol blending and electric vehicles. However, losses remain capped as some support came with Fitch Ratings’ report that the Centre could better its fiscal deficit at 6.6 per cent of GDP in this financial year (FY22) on stronger-than-expected revenue buoyancy, even if the budgeted disinvestment target is not met. In the 2021-22 (April-March) Budget presented on February 1, the government had pegged the fiscal deficit, or gap between the Centre's expenditure and revenue, at 6.8 per cent of GDP or Rs 15.06 lakh crore. On the global front, Asian markets were trading mostly in red as Jerome Powell's renomination to head the Federal Reserve fueled bets on quicker policy tightening. The mood was also cautious amid worries about growth due to the resurgence of coronavirus cases in Europe and re-imposition of lockdown measures in several countries. 

The BSE Sensex is currently trading at 58173.10, down by 292.79 points or 0.50% after trading in a range of 57718.34 and 58401.30. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.68%, while Small cap index was up by 0.69%.

The top gaining sectoral indices on the BSE were Metal up by 2.39%, Realty up by 1.51%, Basic Materials up by 1.34%, Utilities up by 1.29% and PSU up by 0.96%, while IT down by 1.29%, TECK down by 1.18%, Energy down by 1.11%, Bankex down by 0.15% and FMCG down by 0.15% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 2.62%, Power Grid Corporation up by 1.49%, NTPC up by 1.23%, Bajaj Finserv up by 0.63% and SBI up by 0.61%. On the flip side, Infosys down by 2.42%, Asian Paints down by 1.66%, Reliance Industries down by 1.54%, Indusind Bank down by 1.53% and ICICI Bank down by 1.28% were the top losers.

Meanwhile, Fitch Ratings, the international rating agency, has said the Centre could better its fiscal deficit at 6.6 per cent of GDP in this financial year (FY22) on stronger-than-expected revenue buoyancy, even if the budgeted disinvestment target is not met. In the 2021-22 (April-March) Budget presented on February 1, the government had pegged the fiscal deficit, or gap between the Centre's expenditure and revenue, at 6.8 per cent of GDP or Rs 15.06 lakh crore.

At the end of September, which is six months in the financial year, the fiscal deficit touched 35 per cent of budget estimates. The international rating agency had last week kept the sovereign rating unchanged at 'BBB-' with a negative outlook, and said that the risks to India's medium-term growth outlook are narrowing with rapid economic recovery from the pandemic and easing financial sector pressures.

Fitch Ratings Director (Asia-Pacific Sovereigns) Jeremy Zook said the two key positive triggers that could lead to a revision of the outlook to stable are implementation of a credible medium-term fiscal strategy to lower debt burden and higher medium-term investment and growth rates without the creation of macroeconomic imbalances, such as from successful structural reform implementation and a healthier financial sector

The CNX Nifty is currently trading at 17358.85, down by 57.70 points or 0.33% after trading in a range of 17216.10 and 17422.60. There were 28 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were JSW Steel up by 3.51%, Tata Steel up by 2.56%, Divi's Lab up by 1.72%, Adani Ports &Special up by 1.60% and Power Grid Corp up by 1.57%. On the flip side, Infosys down by 2.44%, Asian Paints down by 1.66%, Indusind Bank down by 1.58%, Reliance Industries down by 1.54% and ONGC down by 1.43% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 252.85 points or 1.01% to 24,698.49, Taiwan Weighted dropped 125.03 points or 0.7% to 17,678.51, Jakarta Composite lost 41.96 points or 0.62% to 6,681.43, KOSPI fell 17.76 points or 0.59% to 2,995.49 and Straits Times trembled 4.03 points or 0.12% to 3,233.05.

On the flip side, Shanghai Composite gained 15.45 points or 0.43% to 3,597.53.