Bourses remain under pressure in morning deals

Indian equity benchmarks remained under pressure in morning session, with Sensex and Nifty extending losses to around 570 and 180 points respectively, as sentiment was dampened after a shaky start in Asian trading as investors assessed risks to the economic outlook. Traders also remained cautious with a private survey showed that India's factory output expanded at its slowest pace in nine months in June as elevated price pressures continued to dampen demand and output. While the Manufacturing Purchasing Managers' Index, compiled by S&P Global, remained resilient, it fell to a nine-month low of 53.9 in June from May's 54.6. Some concern also came as RBI in its financial stability report said that persistently high inflation globally is to stay here longer than anticipated as the ongoing war and sanctions take toll on economies, threatening a further slowdown to global trade volume. Besides, exchange data showed foreign institutional investors (FIIs) remained net sellers in the capital market, as they sold shares worth Rs 1,138.05 crore on Thursday.

On the global front, Asian markets are trading in red following another selloff on Wall Street fuelled by recession fears, with warnings of a bleak outlook for the global economy as central banks slam on the brakes to battle soaring inflation. Back home, banking stocks remained in focus as the Reserve Bank of India in its Financial Stability Report for June said that in March 2022, the gross net performing assets' ratio fell to a six-year low of 5.9%.

The BSE Sensex is currently trading at 52450.57, down by 568.37 points or 1.07% after trading in a range of 52094.25 and 52863.34. There were 9 stocks advancing against 21 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.55%, while Small cap index was down by 0.76%.

The top gaining sectoral indices on the BSE were FMCG up by 0.73% and Power up by 0.01%, while Energy down by 2.92%, Oil & Gas down by 2.11%, Metal down by 1.32%, Telecom down by 1.28% and PSU down by 1.05% were the top losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 1.59%, ITC up by 1.55%, Bajaj Finserv up by 1.49%, Indusind Bank up by 0.86% and Hindustan Unilever up by 0.55%. On the flip side, Reliance Industries down by 5.63%, Titan Company down by 2.38%, Bharti Airtel down by 2.03%, Mahindra & Mahindra down by 1.46% and Dr. Reddy's Lab down by 1.24% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) in its Financial Stability Report (FSR) has said the Indian economy is well on the path of recovery even though inflationary pressures and geopolitical risks warrant careful handling and close monitoring of the situation. It also said banks as well as non-banking financial institutions have sufficient capital buffers to withstand shocks.

Further, it observed that the outlook for the global economy is shrouded by considerable uncertainty because of the war in Europe, front-loaded monetary policy normalisation by central banks in response to persistently high inflation and multiple waves of the coronavirus pandemic.

Regarding the banking sector, it said the Capital to Risk weighted Assets Ratio (CRAR) of Scheduled Commercial Banks (SCBs) rose to a new high of 16.7 per cent while their Gross Non Performing Assets (GNPA) ratio fell to a six-year low of 5.9 per cent in March 2022. It added macro stress tests for credit risk reveal that SCBs would be able to comply with the minimum capital requirements even under severe stress scenarios.

The CNX Nifty is currently trading at 15604.95, down by 175.30 points or 1.11% after trading in a range of 15511.05 and 15719.95. There were 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Asian Paints up by 1.82%, ITC up by 1.63%, Bajaj Finserv up by 1.59%, Cipla up by 1.18% and BPCL up by 1.05%. On the flip side, ONGC down by 6.66%, Reliance Industries down by 5.74%, Coal India down by 2.88%, Titan Co down by 2.30% and Bharti Airtel down by 2.23% were the top losers.

Asian markets are trading in red; Nikkei 225 slipped 507.60 points or 1.92% to 25,885.44, Taiwan Weighted dropped 421.03 points or 2.84% to 14,404.70, KOSPI fell 36.36 points or 1.56% to 2,296.28, Shanghai Composite declined 6.26 points or 0.18% to 3,392.36, Straits Times trembled 0.39 points or 0.01% to 3,101.82 and Jakarta Composite lost 65.22 points or 0.94% to 6,846.36.