Markets trade deep in red in early deals; Infosys falls around 4%

Indian equity benchmarks made gap-down opening on Wednesday mirroring weak global cues. Markets are trading lower with cut of around 0.80% each in early deals due to selling in IT and TECK stocks. Traders were concerned as OECD said India’s gross domestic product (GDP) in the June quarter contracted 1.4 per cent quarter-on-quarter, when adjusted for seasonality, and was the second worst performance among the G20 countries - the first being China. Some cautiousness came in as a private report that investments by private equity and venture capital funds plummeted 80 per cent to $2.2 billion in August, a 19-month low. Meanwhile, foreign institutional investors (FIIs) net bought Indian equities worth Rs 1,956.98 crore on September 13, as per data available on the NSE. Also, investors are closely looking ahead to the WPI inflation reading for August.

All the Asian markets are trading lower following the broadly negative cues from global markets overnight, after hotter-than-expected U.S. inflation data raised concerns the Fed will even more aggressively hike interest rate at its upcoming policy meeting next week and triggered heavy selling at several counters from across various sectors. Back home, fertilizer industry stocks were in focus as Union Chemicals and Fertilisers Minister Mansukh Mandaviya said there is no shortage of crop nutrients in the country and asserted that there will be no hike in the prices of non-urea products. In stock specific development, Infosys slumped after reports that it has warned its employees against dual employment or moonlighting.

The BSE Sensex is currently trading at 60058.17, down by 512.91 points or 0.85% after trading in a range of 59417.12 and 60070.84. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 0.28%, while Small cap index was down by 0.39%.

The top gaining sectoral indices on the BSE were PSU up by 0.41%, Power up by 0.23%, Utilities up by 0.05%, FMCG up by 0.01%, while IT down by 3.09%, TECK down by 2.74%, Realty down by 0.78%, Metal down by 0.73%, Capital Goods down by 0.60% were the top losing indices on BSE.

The top gainers on the Sensex were NTPC up by 2.21%, Indusind Bank up by 1.25%, SBI up by 0.91%, ITC up by 0.82% and Power Grid up by 0.68%. On the flip side, Infosys down by 3.96%, Tech Mahindra down by 3.30%, TCS down by 3.19%, HCL Technologies down by 2.13% and Wipro down by 1.95% were the top losers.

Meanwhile, expressing optimism over bilateral trade in the rupee, Finance Minister Nirmala Sitharaman has said many countries have evinced interest for bilateral trade in the rupee after the RBI announced a mechanism recently. She said this along with other steps taken by the government is towards full capital account convertibility. On India is ready for capital account convertibility, she said ‘It isn't the ruble-rupee which was in the old format. Now this (bilateral rupee trade) formulation, which I am glad the RBI has come up at a time which was so critical’.

Highlighting that many countries have evinced interest in trade in the rupee, she said, in a way it is opening the Indian economy more than what can be imagined. She said ‘Post-pandemic, India is coming up with so many out-of-the-box solutions...I would like to highlight the fact that we are a lot more open with the Indian economy, a lot more open in the way we are talking to countries, we are willing to have our digital platform become interoperable between countries to enable cross-border transactions’.

The RBI in July issued a detailed circular asking banks to put in place additional arrangements for export and import transactions in the rupee in view of increasing interest of the global trading community in the domestic currency. The announcement by the Reserve Bank of India (RBI) to allow cross-border trade transactions in the rupee is a timely move and a step towards internationalisation of the currency. Currently, a large part of bilateral trade between India and Russia is getting settled in the rupee due to sanctions imposed by the US and Europe following Moscow's attack on Ukraine.

The CNX Nifty is currently trading at 17926.00, down by 144.05 points or 0.80% after trading in a range of 17771.15 and 17932.60. There were 15 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were NTPC up by 2.06%, Bajaj Auto up by 1.02%, Indusind Bank up by 0.98%, SBI up by 0.94% and ITC up by 0.93%. On the flip side, Infosys down by 3.94%, Tech Mahindra down by 3.22%, TCS down by 3.14%, HCL Technologies down by 2.13% and Wipro down by 1.74% were the top losers.

Asian markets are trading in red; Nikkei 225 slipped 707.09 points or 2.47% to 27,907.54, Straits Times fell 37.11 points or 1.13% to 3,252.97, Hang Seng plunged 492.23 points or 2.55% to 18,834.63, Taiwan Weighted lost 251.82 points or 1.69% to 14,642.59, KOSPI declined 35.54 points or 1.45% to 2,414.00, Jakarta Composite weakened 52.88 points or 0.72% to 7,265.14 and Shanghai Composite was down by 33.31 points or 1.02% to 3,230.49.