Sensex, Nifty witness sharp fall in late morning session

Indian equity benchmarks witnessed a sharp fall in late morning session, on the back of mixed cues from other Asian markets. Traders got cautious, after Reserve Bank of India turned net seller of the US currency in June after it sold USD 3.719 billion on a net basis. In the reporting month, the central bank purchased USD 18.96 billion from the spot market and sold USD 22.679 billion. Some concerns also came with reports that the finance ministry has said that exemptions specified in Free Trade Agreement (FTA) with regard to country of origin will prevail in case of conflict between revenue department and importer.

On the global front, Asian markets were trading mixed, after Japan inflation continued to remain above the 2 percent target on higher fuel prices and weaker yen.  Excluding fresh food, core inflation increased to 2.4 percent from 2.2 percent in the previous month, the Ministry of Internal Affairs and Communications reported. Core inflation exceeded the central bank's 2 percent target for the fourth straight month.

The BSE Sensex is currently trading at 59845.13, down by 452.87 points or 0.75% after trading in a range of 59728.92 and 60411.20. There were 7 stocks advancing against 23 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.81%, while Small cap index was down by 0.45%.

The top gaining sectoral indices on the BSE were Power up by 0.79%, Utilities up by 0.71%, TECK up by 0.58%, IT up by 0.56% and Telecom up by 0.41%, while Realty down by 1.56%, PSU down by 1.41%, Bankex down by 1.25%, Auto down by 1.01% and Healthcare down by 1.01% were the top losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 1.22%, Infosys up by 0.99%, Tech Mahindra up by 0.87%, HCL Tech. up by 0.52% and Wipro up by 0.51%. On the flip side, Indusind Bank down by 3.23%, Bajaj Finserv down by 2.23%, Bajaj Finance down by 2.18%, Maruti Suzuki down by 2.04% and Power Grid down by 2.03% were the top losers.

Meanwhile, PHD Chamber of Commerce and Industry (PHDCCI) in its report has said that increasing domestic production in sectors such as chemicals, automotive components, drug formulations and consumer electronics will help in reducing imports worth about $35 billion from China in the coming times. It said that in recent years, imports from China have increased significantly and it was about $87 billion in 2021.

According to the report, India holds the immense potential to reduce 40 per cent imports (around $35 billion) from China in the coming times as there are various product categories which India also produces but at a lower volume. Imports from China have changed from low-value, low-cost products like toys and crackers to high-value items like electronics. India has significant scope for producing more import substitution in the sectors, including chemicals, bicycle parts, handicrafts, cosmetics and leather-based goods.

The report further said enhanced production in these sectors will not only reduce imports from China but also boost India's exports. It also said that since the domestic market has production capabilities; these sectors can readily minimize their dependence on China in a phased manner without any substantial extra investments.

The CNX Nifty is currently trading at 17820.50, down by 136.00 points or 0.76% after trading in a range of 17783.00 and 17992.20. There were 10 stocks advancing against 40 stocks declining on the index.

The top gainers on Nifty were Adani Ports & SEZ up by 2.97%, Larsen & Toubro up by 1.18%, Infosys up by 1.08%, Tech Mahindra up by 0.81% and Wipro up by 0.54%. On the flip side, Indusind Bank down by 3.23%, Bajaj Finance down by 2.17%, Bajaj Finserv down by 2.13%, Apollo Hospital down by 2.08% and Maruti Suzuki down by 2.07% were the top losers.

Asian markets were trading mixed; Straits Times trembled 23.55 points or 0.72% to 3,249.93, KOSPI fell 12.85 points or 0.51% to 2,495.20, Nikkei 225 slipped 8.93 points or 0.03% to 28,933.21 and Shanghai Composite declined 9.08 points or 0.28% to 3,268.46. On the flip side, Jakarta Composite soared 12.01 points or 0.17% to 7,198.57, Taiwan Weighted strengthened 12.02 points or 0.08% to 15,408.78 and Hang Seng increased 48.29 points or 0.24% to 19,812.20.