Domestic markets trim opening losses; trade flat with negative bias in early deals

Indian equity benchmarks started the Thursday’s session in red territory tracking weakness in their global peers. Though, domestic indices -- Sensex and Nifty -- managed to trim initial losses and are trading tad lower in early deals. Some cautiousness prevailed among market participants as former deputy chairman of the erstwhile Planning Commission Montek Singh Ahluwalia said it would be unrealistic to assume that India would record a sustained growth of 8 per cent, which is needed to become a developed nation by 2047. However, downside remained capped as the ministry of statistics and programme implementation in its final Annual Survey of Industries (ASI) said manufacturing sector investments grew 20.9% in 2019-20 over the previous fiscal. Continued foreign fund inflows in domestic markets also aided the market sentiments. As per provisional data available on the NSE, foreign institutional investors (FIIs) have net bought shares worth Rs 2,347.22 crore on August 17. Traders took note of report that the Union Cabinet earmarked Rs 34,856 crore towards the interest subvention scheme to help banks provide short term agriculture loans of up to Rs 3 lakh at a rate of 7 per cent.

Most of the Asian markets are trading lower following the broadly negative cues from global markets overnight, as worries about slowing growth and soaring inflation continue to weigh on market sentiment. The US Fed minutes also reaffirmed the central bank's plans to continue raising interest rates in an effort to return inflation to its 2 percent objective. Back home, telecom stocks were in focus as data released by sector regulator Trai showed that telecom subscriber base in the country grew marginally to 117.29 crore in June with Reliance Jio adding maximum number of new customers. There were 117.07 crore subscribers in May 2022. In stock specific developments, Craftsman Automation gained as new plant commences operations. Indo Amines surged on receiving environmental clearance for units.

The BSE Sensex is currently trading at 60216.15, down by 43.98 points or 0.07% after trading in a range of 59969.08 and 60223.31. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.54%, while Small cap index was up by 0.55%.

The top gaining sectoral indices on the BSE were Realty up by 1.09%, Telecom up by 0.71%, Utilities up by 0.61%, Power up by 0.55%, FMCG up by 0.55%, while Oil & Gas down by 0.57%, Energy down by 0.48%, IT down by 0.45%, Healthcare down by 0.44%, TECK down by 0.38% were the top losing indices on BSE.

The top gainers on the Sensex were Kotak Mahindra Bank up by 1.49%, SBI up by 1.14%, Hindustan Unilever up by 0.81%, Bharti Airtel up by 0.76% and Power Grid up by 0.68%. On the flip side, Dr. Reddy's Lab down by 2.40%, Wipro down by 1.42%, Sun Pharma down by 1.23%, Infosys down by 0.77% and Reliance Industries down by 0.58% were the top losers.

Meanwhile, expressing some cautiousness over the country’s growth, former deputy chairman of the erstwhile Planning Commission Montek Singh Ahluwalia has said it would be unrealistic to assume that India would record a sustained growth of 8 per cent, which is needed to become a ‘developed nation’ by 2047. He added India's annual per capita income is around $2,000 and it is unlikely that it would increase to $12,000 by 2047 to become a high-income country as per the World Bank's definition. According to him, those who think India's growth projections in the near future are 7 - 7.5 per cent should recognise that the country cannot maintain that pace for such a long time. He added that ‘so 6 per cent average economic growth rate (for India) is not unreasonable’.

He further said in the strong policy scenario, India's annual per capita income will be about $9,600 by 2047, and in the central scenario, the country would get to $7,500. Noting that those are significant improvements from the present level, he said ‘but I think we need to be a little realistic on what exactly can be achieved in this period, given the growth rates that are possible’. India, which is the world's sixth largest economy with a GDP of $2.7 trillion, is currently classified as a developing nation.

He said ‘now of course it is quite possible that somebody projects that India can grow at 8 per cent, then maybe the target would become feasible’, but added that he is not sure about these projections. India was classified as a 'third-world' country at the time of Independence from British rule in 1947. But over the past seven decades, its GDP has grown from just Rs 2.7 lakh crore to Rs 150 lakh crore. He also said climate change could be the biggest threat to growth and prosperity, especially for countries in the tropics and India could be one of the worst affected. He added the single most important thing India has to do is to de-carbonise the generation of power.

The CNX Nifty is currently trading at 17935.80, down by 8.45 points or 0.05% after trading in a range of 17863.45 and 17942.95. There were 26 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were SBI Life Insurance up by 1.83%, Kotak Mahindra Bank up by 1.63%, HDFC Life Insurance up by 1.15%, SBI up by 1.07% and Hindustan Unilever up by 0.85%. On the flip side, Dr. Reddy's Lab down by 2.52%, ONGC down by 2.47%, Wipro down by 1.37%, BPCL down by 1.35% and Sun Pharma down by 1.17% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 slipped 258.28 points or 0.88% to 28,964.49, Hang Seng declined 118.06 points or 0.59% to 19,804.39, Taiwan Weighted lost 95.46 points or 0.62% to 15,369.99, KOSPI fell 12.70 points or 0.50% to 2,503.77 and Shanghai Composite was down by 15.91 points or 0.48% to 3,276.62. On the other hand, Straits Times added 14.91 points or 0.46% to 3,277.67 and Jakarta Composite was up by 4.52 points or 0.06% to 7,137.97.