Benchmarks trade under pressure; Sensex crashes over 750 points

Indian equity benchmarks have made gap-down opening on Friday amid losses across other Asian markets. Domestic indices are trading deeply in red with losses of over a percent each in early deals due to selling in almost all the sector indices led by Realty, Metal and Auto stocks. Only healthcare index is trading in green. Traders were concerned as WHO flags new Covid-19 strain. World Health Organization officials met on Thursday to discuss a new coronavirus variant circulating in South Africa and Botswana. The new variant, called B.1.1529, carries an unusually large number of mutations, Francois Balloux, director of the UCL Genetics Institute. Also, foreign fund outflow dented sentiments in the markets. Foreign portfolio investors (FPIs) remained net sellers for Rs 2300.65 crore in the Indian markets, provisional data showed on the NSE.  Adding some pessimism, a report by ICRA said the RBI’s revision of bad loan recognition and upgradation norms could bring a sharp spike in the non-performing assets of non-banking finance companies (NBFCs) in the country.

Asian cues remained subdued with all the markets traded under pressure after scientists in South Africa identified a concerning new variant of the coronavirus, whose mutations mark a ‘big jump in evolution’. Britain and Israel temporarily banned flights from South Africa and five neighboring countries as a precautionary measure. Worries about inflation and bets of faster monetary policy tightening in the U.S. also dented sentiment, heading into the weekend. Back home, Tarsons Products shares to be listed on the stock exchanges later in the day. The Rs 1,023 crore IPO of the life sciences company was heavily subscribed by investors earlier this month. The issue price has been fixed at Rs 662 per share.

The BSE Sensex is currently trading at 58044.03, down by 751.06 points or 1.28% after trading in a range of 57914.15 and 58254.79. There were 2 stocks advancing against 28 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.80%, while Small cap index was down by 0.35%.

The sole gaining sectoral index on the BSE was Healthcare up by 1.96%, while Realty down by 2.53%, Metal down by 2.11%, Auto down by 1.66%, Bankex down by 1.57% and Basic Materials down by 1.46% were the top losing indices on BSE.

The only gainers on the Sensex were Dr. Reddy's Lab up by 3.01% and Sun Pharma up by 1.59%. On the flip side, Maruti Suzuki down by 2.66%, Tata Steel down by 2.61%, Kotak Mahindra Bank down by 2.29%, Bajaj Finserv down by 2.19% and HDFC down by 2.14% were the top losers.

Meanwhile, investments in Indian capital markets through participatory notes (P-notes) rose to Rs 1.02 lakh crore till October-end, making it the highest level in 43 months. P-notes are issued by registered foreign portfolio investors (FPIs) to overseas investors who wish to be a part of the Indian stock market without registering themselves directly. However, they need to go through a due diligence process.

According to Securities and Exchange Board of India data, the value of P-note investments in Indian markets -- equity, debt, and hybrid securities -- was at Rs 1,02,553 crore by October end. This was the highest level since March 2018, when P-notes had invested to the tune of Rs 1,06,403 crore. Of the total Rs 1,02,552 crore invested through the route till October, Rs 93,213 crore was invested in equities, Rs 8,885 crore in debt, Rs 455 crore in hybrid securities.

At the end of September this year, the investment level was at 97,751 crore, Rs 97,744 crore by August end. The figure for July was revised to Rs 85,799 crore from Rs 1,01,798 crore posted earlier. Prior to that, the investment level was at Rs 92,261 crore by June-end, Rs 89,743 crore by May-end, Rs 88,447 crore at April-end, and Rs 89,100 crore by March-end.

The CNX Nifty is currently trading at 17317.30, down by 218.95 points or 1.25% after trading in a range of 17272.00 and 17355.40. There were 6 stocks advancing against 44 stocks declining on the index.

The top gainers on Nifty were Cipla up by 2.91%, Dr. Reddy's Lab up by 2.88%, Sun Pharma up by 1.41%, Divi's Lab up by 0.87% and Coal India up by 0.28%. On the flip side, ONGC down by 3.19%, Maruti Suzuki down by 2.88%, Tata Motors down by 2.84%, Hindalco down by 2.65% and JSW Steel down by 2.50% were the top losers.

All the Asian markets are trading in red; Nikkei 225 plunged 850.62 points or 2.88% to 28,648.66, Straits Times declined 43.19 points or 1.34% to 3,178.33, Hang Seng slipped 515.43 points or 2.08% to 24,224.73, Taiwan Weighted fell 256.01 points or 1.45% to 17,398.18, KOSPI lost 34.77 points or 1.17% to 2,945.50, Jakarta Composite weakened 86.73 points or 1.29% to 6,612.62 and Shanghai Composite was down by 18.00 points or 0.50% to 3,566.18.