Benchmarks add losses in morning deals

Indian equity benchmarks added losses in morning deals, mirroring weak global market trends after the US Fed's interest rate hike. Traders remained cautious as data showed foreign institutional investors offloaded shares worth Rs 461.04 crore on Wednesday after two days of buying. Traders overlooked the Federation of Indian Export Organisations (FIEO), the apex body of India's export promotion councils, stated that Indian exports to the six Gulf Cooperation Council countries (GCC) grew by 44 per cent to about $43.9 billion in 2021-22 fiscal year compared to previous fiscal's $27.8 billion with the UAE leading the trade with a remarkable 68 per cent growth. Market participants also paid no heed towards rating agency Crisil stating that gross non-performing assets (GNPAs) of banks - a key indicator of asset quality - is expected to improve 90 basis points (bps) to 5% this fiscal on-year (FY23), and another 100 bps to a decadal low of 4% by March 31, 2024 (FY24), riding on post-pandemic economic recovery and higher credit growth.

On the global front, Asian markets are trading mostly in red following the broadly negative cues from Wall Street overnight, with weakness across most sectors as traders digest another rate hike by the US Fed and the hawkish comments by Fed Chair Jerome Powell. Back home, logistics industry stocks remained in focus as the Union Cabinet approved the National Logistics Policy (NLP) that aims to enable seamless movement of goods across the country as well as improve the competitiveness of Indian goods in the domestic and export markets.

The BSE Sensex is currently trading at 59076.72, down by 380.06 points or 0.64% after trading in a range of 58973.07 and 59403.05. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.12%, while Small cap index was up by 0.26%.

The top gaining sectoral indices on the BSE were FMCG up by 0.87%, Industrials up by 0.31%, Capital Goods up by 0.12%, Telecom up by 0.06% and Auto up by 0.06%, while Bankex down by 1.18%, Energy down by 0.97%, Oil & Gas down by 0.89%, Power down by 0.77% and Utilities down by 0.76% were the top losing indices on BSE.

The top gainers on the Sensex were ITC up by 1.99%, Hindustan Unilever up by 0.92%, TCS up by 0.54%, Asian Paints up by 0.44% and Tech Mahindra up by 0.25%. On the flip side, Bajaj Finserv down by 2.91%, HDFC down by 2.05%, Power Grid Corporation down by 1.90%, HDFC Bank down by 1.51% and ICICI Bank down by 1.21% were the top losers.

Meanwhile, Crisil Ratings in its latest report has said that gross non-performing assets (GNPAs) of banks - a key indicator of asset quality - is expected to improve 90 basis points (bps) to 5% this fiscal on-year (FY23), and another 100 bps to a decadal low of 4% by March 31, 2024 (FY24), riding on post-pandemic economic recovery and higher credit growth.

It stated the asset quality of the banking sector will also benefit from the proposed sale of NPAs to the National Asset Reconstruction Company (NARCL). That said, not all segments will perform equally well. The biggest improvement will be in the corporate segment, where gross NPAs is seen falling below 2% next fiscal from a peak of 16% as on March 31, 2018.

However, it said that all is not well on the dud asset front, and banking system's exposures to the Micro, Small and Medium Enterprises (MSME) sector is a worry. Gross NPA in the MSME segment, which suffered the most during Covid pandemic, may rise to 10-11 per cent by March 2024 from 9.3 per cent as on March 31, 2022.

The CNX Nifty is currently trading at 17614.45, down by 103.90 points or 0.59% after trading in a range of 17580.40 and 17708.25. There were 12 stocks advancing against 38 stocks declining on the index.

The top gainers on Nifty were ITC up by 2.07%, Eicher Motors up by 1.47%, Hindustan Unilever up by 1.23%, Adani Ports & SEZ up by 0.72% and TCS up by 0.66%. On the flip side, Bajaj Finserv down by 2.84%, SBI Life Insurance down by 2.40%, Power Grid Corporation down by 2.16%, HDFC down by 1.95% and HDFC Bank down by 1.48% were the top losers.

Asian markets are trading mostly in red; Hang Seng decreased 329.35 points or 1.79% to 18,115.27, Taiwan Weighted dropped 170.93 points or 1.18% to 14,253.59, Nikkei 225 slipped 143.74 points or 0.53% to 27,169.39, KOSPI fell 21.51 points or 0.92% to 2,325.70, Straits Times trembled 11.12 points or 0.34% to 3,250.67 and Shanghai Composite declined 10.04 points or 0.32% to 3,107.14.

On the flip side, Jakarta Composite was up by 14.71 points or 0.2% to 7,203.02.