Benchmarks continue to trade in red terrain in morning deals

Indian equity benchmarks continued to trade in red terrain in morning deals, due to losses in IT, TECK and Healthcare shares amid weak global trends. Traders remain concerned as the SBI Business Activity Index declined to 101 as on January 17 from 109 in the week ended January 10. The latest reading, even as the country is in the midst of the third wave of the pandemic, is the lowest since November 15. Besides, stock exchange data showed that foreign investors remained net sellers in the Indian equity markets as they offloaded stocks worth Rs 1,254.95 crore on Tuesday. Traders overlooked report stated that private equity and venture capital funds invested $77 billion in Indian companies in 2021, a jump of 62 per cent over the previous year. It said the year saw a massive glut of liquidity across the world coming out of the pandemic, which led to higher investments in many assets and a surge in valuations.

On the global front, Asian markets are trading mostly in red after a broad sell-off on Wall Street on January 18 as bond yields surged amid renewed fears that the U.S. Federal Reserve will act more aggressively than expected to tackle rising inflation. Back home, on the sectoral front, Power industry’s stocks remained in watch as the power ministry said that as many as 20 states have evinced interest for getting additional borrowing space for the power sector under a central scheme.

The BSE Sensex is currently trading at 60315.16, down by 439.70 points or 0.72% after trading in a range of 60194.94 and 60870.17. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.67%, while Small cap index was down by 0.24%.

The top gaining sectoral indices on the BSE were Metal up by 0.75%, Oil & Gas up by 0.58%, PSU up by 0.53%, Energy up by 0.34% and Utilities up by 0.19%, while IT down by 1.64%, TECK down by 1.44%, Healthcare down by 0.83%, Realty down by 0.68% and Consumer Discretionary down by 0.56% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 1.24%, Power Grid Corporation up by 0.49%, Axis Bank up by 0.41%, SBI up by 0.35% and Reliance Industries up by 0.29%. On the flip side, Asian Paints down by 2.02%, Infosys down by 1.98%, Ultratech Cement down by 1.97%, Wipro down by 1.77% and HCL Technologies down by 1.53% were the top losers.

Meanwhile, the power ministry has said that as many as 20 states have evinced interest for getting additional borrowing space for the power sector under a central scheme. The Ministry of Finance had launched a programme in June 2021 to allow additional borrowing space of Rs 80,000 crore to states, which is conditional on them undertaking and sustaining specific reforms in the power sector.

Based on the recommendations of Ministry of Power in respect of such proposal from Andhra Pradesh state, Ministry of Finance had accorded their approval and the state has already availed borrowings of more than Rs 2100 crore, to partly utilize such allowed additional borrowing space. The proposals of Manipur and Rajasthan are also under active consideration at Ministry of Finance, both of which may be eligible for the maximum limit of 0.50 per cent increased borrowing space, based on reforms carried out by them in the power sector. Rest of the states are also submitting their proposals.

It stated under the programme, the additional borrowing limit permitted for power sector reforms is 0.5 per cent of the Gross State Domestic Product (GSDP) of the respective state. This being the first year (2021-22) of the current version of the scheme, the requirements of reforms and actions has been kept less onerous, with the bar raised for future years, pushing the states towards higher level reforms.

The CNX Nifty is currently trading at 18003.50, down by 109.55 points or 0.60% after trading in a range of 17950.25 and 18129.20. There were 16 stocks advancing against 33 stocks declining on the index.

The top gainers on Nifty were ONGC up by 2.47%, Coal India up by 1.71%, Tata Steel up by 1.16%, UPL up by 1.14% and Indian Oil Corporation up by 1.01%. On the flip side, Asian Paints down by 2.11%, Shree Cement down by 2.00%, Tata Consumer Product down by 1.98%, Infosys down by 1.97% and Ultratech Cement down by 1.87% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 slipped 753.55 points or 2.67% to 27,503.70, Taiwan Weighted dropped 146.30 points or 0.8% to 18,232.34, KOSPI fell 25.22 points or 0.88% to 2,839.02, Hang Seng decreased 18.22 points or 0.08% to 24,094.56, Shanghai Composite declined 10.50 points or 0.29% to 3,559.41 and Jakarta Composite lost 4.43 points or 0.07% to 6,609.63.

On the global front, Straits Times advanced 0.64 points or 0.02% to 3,280.68.