Heavy selling in energy and oil & gas stocks keeps markets weak

Heavy selling in energy and oil & gas stocks kept Indian equity markets weak in late morning session, with both Sensex and Nifty trading lower, on the back of negative cues from other Asian markets. Domestic sentiments were cautious, as the Reserve Bank of India (RBI) said that financial risks associated with the profile of government debt can hamper the functioning of fixed-income markets. Adding more worries among traders, the Reserve Bank said that India's external debt increased by USD 47.1 billion to USD 620.7 billion in the financial year ended March 2022. However, the external debt to GDP ratio declined to 19.9 per cent at the end of March from 21.2 per cent at the end of March 2021.

On the global front, Asian markets were trading in red, after the manufacturing sector in Thailand continued to expand in June, albeit at a slower pace, the latest survey from S&P Global showed on Friday with a manufacturing PMI score of 50.7. That's down from 51.9 in May although it remains above the boom-or-bust line of 50 that separates expansion from contraction.

The BSE Sensex is currently trading at 52502.22, down by 516.72 points or 0.97% after trading in a range of 52094.25 and 52863.34. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.24%, while Small cap index was down by 0.55%.

The only gaining sectoral indices on the BSE were FMCG up by 0.81% and Realty up by 0.48%, while Energy down by 3.68%, Oil & Gas down by 3.21%, PSU down by 1.41%, Telecom down by 1.19% and Consumer Durables down by 1.08% were the top losing indices on BSE.

The top gainers on the Sensex were Bajaj Finserv up by 2.48%, Asian Paints up by 1.99%, ITC up by 1.50%, Bajaj Finance up by 1.34% and Indusind Bank up by 0.99%. On the flip side, Reliance Industries down by 5.78%, Titan Co down by 2.66%, Bharti Airtel down by 1.54%, Power Grid down by 1.35% and ICICI Bank down by 1.20% were the top losers.

Meanwhile, the growth of eight core infrastructure industries grew to 13-month high of 18.1 per cent in May 2022, led by healthy growth in coal, crude oil, fertilisers, cement and electricity production. The growth of core infrastructure sectors expanded by 16.4 per cent in the year-ago period and 9.3 per cent in April 2022. The Eight Core Industries - coal, crude oil, natural gas, refinery products, fertilizers, steel, cement and electricity - comprise 40.27 percent of the weight of items included in the Index of Industrial Production (IIP).

Coal production having 10.33 per cent weight increased by 25.1 per cent in May, 2022 over May, 2021 and its cumulative index increased by 26.9 per cent during April to May, 2022-23 over corresponding period of the previous year. Crude Oil production having 8.98 per cent weight increased by 4.6 per cent in May, 2022 over May, 2021 and its cumulative index increased by 1.8 per cent during April to May, 2022-23 over the corresponding period of previous year. Natural Gas production having 6.88 per cent weight increased by 7.0 per cent in May, 2022 over May, 2021 and its cumulative index increased by 6.7 per cent during April to May, 2022-23 over the corresponding period of previous year.

Petroleum Refinery production having 28.04 per cent weight increased by 16.7 per cent in May, 2022 over May, 2021 and its cumulative index increased by 12.8 per cent during April to May, 2022-23 over the corresponding period of previous year. Fertilizers production having 2.63 per cent weight increased by 22.8 per cent in May, 2022 over May, 2021 and its cumulative index increased by 16.3 per cent during April to May, 2022-23 over the corresponding period of previous year. Steel production having 17.92 per cent weight increased by 15.0 per cent in May, 2022 over May, 2021 and its cumulative index increased by 8.4 per cent during April to May, 2022-23 over the corresponding period of previous year.

Cement production having 5.37 per cent weight increased by 26.3 per cent in May, 2022 over May, 2021 and its cumulative index increased by 15.9 per cent during April to May, 2022-23 over the corresponding period of previous year. Electricity generation having 19.85 per cent weight increased by 22.0 per cent in May, 2022 over May, 2021 and its cumulative index increased by 16.7 per cent during April to May, 2022-23 over the corresponding period of previous year.

The CNX Nifty is currently trading at 15614.15, down by 166.10 points or 1.05% after trading in a range of 15511.05 and 15719.95. There were 23 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were Bajaj Finserv up by 2.44%, Asian Paints up by 2.22%, Cipla up by 1.77%, ITC up by 1.32% and Bajaj Finance up by 1.27%. On the flip side, ONGC down by 12.08%, Reliance Industries down by 6.07%, Titan Co down by 2.66%, Bajaj Auto down by 2.51% and Coal India down by 1.91% were the top losers.

Asian markets were 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.