Sensex, Nifty remain lower in late morning session

Indian equity benchmarks remained lower in late morning session, with both Sensex and Nifty trading in deep red. Negative cues from other Asian markets impacted domestic sentiments. Traders were worried, as a top WHO official said that it is not possible to end the COVID-19 virus as such viruses never go away and end up becoming part of the ecosystem, but asserted that it is possible to end this year the public health emergency caused by COVID-19 with a collaborative approach to fix inherent inequities in the system. Adding more concerns, Crisil Ratings said disruptions due to the third COVID wave could shave off as much as 200 basis points from the growth in assets under management of housing finance companies in the current and next financial years.

Sentiments remained negative, as ratings agency ICRA in its latest report has said that States are shelling out more for debt funds, with the weighted average cost for their debt auctions hardening by 9 basis points (bps) to touch 7.24 per cent, the highest level so far this fiscal, during the auctions on January 18, 2022. Compared to the previous week, the cost has gone up by 9 bps. From the first auctions in January, the cut-offs have been trending over 7 per cent.

On the global front, Asian markets were trading mostly in red, after Japan's industrial production rose less than initially estimated in November. The data from the Ministry of Economy, Trade and Industry said that industrial production rose a seasonally adjusted 7.0 percent monthly in November. In the initial estimate, output grew 7.2 percent. Shipments rose 7.4 percent monthly in November, as estimated.

The BSE Sensex is currently trading at 60293.42, down by 461.44 points or 0.76% after trading in a range of 60148.77 and 60870.17. There were 4 stocks advancing against 26 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.66%, while Small cap index was down by 0.23%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 0.61%, Metal up by 0.49%, PSU up by 0.41%, Energy up by 0.20% and Utilities up by 0.13%, while IT down by 1.48%, TECK down by 1.27%, Realty down by 0.93%, Basic Materials down by 0.58% and FMCG down by 0.55% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 0.65%, Maruti Suzuki up by 0.13%, Dr. Reddy's Lab up by 0.13% and HDFC Bank up by 0.07%. On the flip side, Asian Paints down by 2.78%, Ultratech Cement down by 2.59%, Infosys down by 1.87%, Bajaj Finance down by 1.84% and Wipro down by 1.53% were the top losers.

Meanwhile, Ratings agency ICRA in its latest report has said that States are shelling out more for debt funds, with the weighted average cost for their debt auctions hardening by 9 basis points (bps) to touch 7.24 per cent, the highest level so far this fiscal, during the auctions on January 18, 2022. Compared to the previous week, the cost has gone up by 9 bps. From the first auctions in January, the cut-offs have been trending over 7 per cent.

According to the report, while 12 states raised Rs 21,200 crore on January 18, 6 per cent higher than the indicated level for this week, six of them borrowed Rs 6,700 crore more than indicated led by Uttar Pradesh. It borrowed Rs 900 crore more than the amount indicated. The share of longer tenor and 10-year debt has risen to 48 per cent so far in Q4 from 42 per cent and 29 per cent, respectively, in Q3 and Q2 of FY22. At the latest auctions, Rs 11,500 crore or 54 per cent of the total issuance was in longer tenor debt, Rs 7,200 crore or 34 per cent was in 10-year instruments and the balance Rs 2,500 crore or 12 per cent was in shorter tenor.

The report said in line with global trends, domestic yields have hardened since last week, reflecting the imminent rate hikes by the US Fed, increase in crude oil prices, firming of the domestic CPI inflation as well as the magnitude of supply expected in FY23.

The CNX Nifty is currently trading at 17987.05, down by 126.00 points or 0.70% after trading in a range of 17941.70 and 18129.20. There were 14 stocks advancing against 36 stocks declining on the index.

The top gainers on Nifty were ONGC up by 2.96%, Coal India up by 1.71%, Bajaj Auto up by 0.98%, UPL up by 0.91% and Hero MotoCorp up by 0.80%. On the flip side, Asian Paints down by 2.86%, Shree Cement down by 2.62%, Adani Ports & SEZ down by 2.56%, Ultratech Cement down by 2.47% and Tata Consumer Products down by 2.11% were the top losers.

Asian markets were 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 flip side, Straits Times advanced 0.64 points or 0.02% to 3,280.68.