Domestic indices trade lower; Nifty slips below 17,250 mark

Indian equity benchmarks made cautious start on Wednesday following mixed global cues. Soon, markets slipped into red terrain and are trading lower with cut of over half a percent each in early deals due to selling in IT, TECK and Realty stocks. Concerns about the Omicron variant of COVID-19 spooked investors. Eight more cases of the Omicron variant of coronavirus were detected in Maharashtra on Tuesday, out of which seven were reported in Mumbai city. Further, sentiments dampened as the Asian Development Bank for the second time in three months has scaled down India’s growth estimate for the fiscal year ending March 2022 due to supply chain issue of industries. Adding pessimism, the Centre for Monitoring Indian Economy (CMIE) stated that the urban unemployment rate spiked to the double-digit rate for the first time in 17 weeks, to be 10.09% for the week-ended December 12, pushing the country’s overall jobless rate to a nine-week high of 8.53%. Traders paid no heed towards the government data showing that India's merchandise exports jumped 27.16 per cent to $30.04 billion in November on the back of good performance by sectors like petroleum products, engineering goods and electronic items.

On the global front, most of the Asian markets traded higher as investors await the latest U.S. Federal Reserve policy decision. With authorities signaling upcoming support for the economy in 2022, all eyes are now on the People’s Bank of China’s loan operations for clues about the broader policy stance. Some cautiousness came following the broadly negative cues overnight from Wall Street, on renewed concerns about the impact of the coronavirus Omicron variant on global economic recovery. Back home, NBFCs stocks were in focus as the RBI introduced a prompt corrective action (PCA) framework for large non-banking financial companies (NBFCs), putting restrictions on para-banks whenever vital financial metrics dip below the prescribed threshold. The PCA framework for NBFCs comes into effect on October 1 next year on the basis of their financial position on or after March 31. Besides, Escorts, Indiabulls Housing Finance and Vodafone Idea are the only stocks in the F&O ban period today.

The BSE Sensex is currently trading at 57801.31, down by 315.78 points or 0.54% after trading in a range of 57791.68 and 58218.25. There were 7 stocks advancing against 23 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.14%, while Small cap index was up by 0.05%.

The top gaining sectoral indices on the BSE were Metal up by 0.48%, Power up by 0.27%, PSU up by 0.20%, Basic Materials up by 0.12%, Telecom up by 0.11%, while IT down by 1.19%, TECK down by 1.08%, Realty down by 1.07%, Healthcare down by 0.66%, FMCG down by 0.48% were the top losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 0.88%, NTPC up by 0.75%, Tata Steel up by 0.45%, Bajaj Auto up by 0.32% and Power Grid up by 0.24%. On the flip side, Bajaj Finance down by 1.52%, Infosys down by 1.35%, TCS down by 1.32%, HCL Technologies down by 1.23% and Tech Mahindra down by 1.21% were the top losers.

Meanwhile, amid supply chain issue of industries, the Asian Development Bank (ABD) in its latest supplement to the Asian Development Outlook (ADO) 2021 has scaled down India's growth estimate for the fiscal year ending March 2022 for the second time in three months. It has pegged India's growth estimate at 9.7 percent for the current fiscal year in its latest supplement.

It said South Asia is forecast to grow at 8.6 per cent in 2021, compared with the September's forecast of 8.8 per cent. As per the ADB supplement ‘India, South Asia's largest economy, is now expected to grow 9.7 per cent in fiscal year 2022. The reduction of 0.3 percentage points comes amid supply chain issues that are affecting industry.’

Citing the adverse impact of the second wave of the pandemic, in September, the Asian Development Bank had revised down India's economic growth forecast for the current fiscal to 10 per cent, from 11 per cent predicted earlier.

The CNX Nifty is currently trading at 17234.85, down by 90.05 points or 0.52% after trading in a range of 17227.35 and 17351.20. There were 13 stocks advancing against 37 stocks declining on the index.

The top gainers on Nifty were NTPC up by 0.75%, JSW Steel up by 0.69%, Mahindra & Mahindra up by 0.68%, Coal India up by 0.60% and Tata Consumer Products up by 0.51%. On the flip side, Divi's Lab down by 1.99%, Bajaj Finance down by 1.60%, TCS down by 1.39%, HCL Technologies down by 1.30% and Infosys down by 1.23% were the top losers.

Asian markets are trading mostly in green; Nikkei 225 rose 16.38 points or 0.06% to 28,449.02, Hang Seng gained 48.99 points or 0.21% to 23,684.94, Taiwan Weighted added 77.11 points or 0.44% to 17,676.48, Jakarta Composite advanced 35.49 points or 0.54% to 6,651.13 and Shanghai Composite was up by 2.66 points or 0.07% to 3,664.19. On the other hand, Straits Times fell 11.11 points or 0.36% to 3,109.98 and KOSPI was down by 10.07 points or 0.34% to 2,977.88.