Bourses trade flat in morning deals

Indian equity benchmarks were trading flat as traders booked profit after initial gains. Sentiments were weak after chief economic adviser -- V Anantha Nageswaran has said the country’s external sector could face some anxious moments this financial year, as the proposed oil price cap on global crude could instead serve to raise those instead. The way the oil price cap is being discussed has encouraged oil and gas traders to stock up on volumes, creating unintended consequences. This could create additional pressure on India’s balance of payments.  However, downside remained capped as an appreciating rupee and foreign fund inflows supported the markets. The rupee gained 21 paise to 82.14 against the US dollar in early deals on Monday. As per exchange data, foreign institutional investors were net buyers in the Indian capital market on Friday as they bought shares worth Rs 1,436.25 crore. On the global front, Asian markets were trading in green with strength in resources and energy stocks boosting the markets amid the spike in commodity prices. Markets were also supported by stronger-than-expected employment data from the US that helped raise hopes the US Fed would slow its pace of interest rate hikes in future.

The BSE Sensex is currently trading at 60923.29, down by 27.07 points or 0.04% after trading in a range of 60894.97 and 61401.54. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.48%, while Small cap index was up by 0.51%.

The top gaining sectoral indices on the BSE were PSU up by 2.00%, Utilities up by 1.26%, Power up by 1.16%, Metal up by 0.82% and Bankex up by 0.78%, while Healthcare down by 0.49%, TECK down by 0.47%, IT down by 0.38%, Consumer Durables down by 0.13% and Telecom down by 0.12% were the top losing indices on BSE.

The top gainers on the Sensex were SBI up by 3.61%, Power Grid Corporation up by 2.08%, Tata Steel up by 1.77%, ICICI Bank up by 1.03% and Mahindra & Mahindra up by 0.73%. On the flip side, Dr. Reddy's Lab down by 1.71%, Asian Paints down by 1.15%, Sun Pharma down by 1.06%, Titan Company down by 0.99% and Tech Mahindra down by 0.73% were the top losers.

Meanwhile, Chief Economic Adviser (CEA) V Anantha Nageswaran has said that India is encountering global shocks with a position of strength backed by far better household, corporate and financial sector balance sheets and its medium term growth outlook is good. He said ‘Overall, all things considered, including the risk of oil price, I do believe that the external situation will be manageable, of course with some anxious moments to come.’

CEA further said that given all the short-term unknowns, it was better to focus on medium-term prospects and what lies ahead of the country in the next six years until 2030. He said ‘the medium-term growth outlook is actually constructive very simply because we have paid our growth dues last decade and that was because we had to undergo balance sheet repair in the financial and non-financial sector.

Talking on the high debt-to-GDP ratio, he said it is sustainable as India's macroeconomic fundamentals are strong. He said even in the ongoing global turmoil India's borrowing cost is lower than countries which have better ratings than India. He also said ‘India's bond yield has not really spiked up. It is doing better than countries that have better credit ratings than India. That tells us a little bit about the overall macroeconomic stability that is there under the current circumstances’.

Nageswaran also stated that the country's current account deficit could range between 3-3.5 per cent during the current financial year depending on evolving external factors. With regard to the medium term outlook for growth, he said it would be closer to 6.5-7 per cent rather than closer to 6 per cent taking a baseline scenario of oil under $100 a barrel. This growth would be largely driven by the capital formation and robust public digital infrastructure leading to formalisation of the economy.

The CNX Nifty is currently trading at 18138.50, up by 21.35 points or 0.12% after trading in a range of 18128.50 and 18255.50. There were 26 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were Britannia Industries up by 8.90%, SBI up by 3.75%, Adani Enterprises up by 2.53%, Power Grid Corporation up by 2.01% and Tata Steel up by 1.81%. On the flip side, Dr. Reddy's Lab down by 1.64%, Cipla down by 1.47%, Asian Paints down by 1.40%, Sun Pharma down by 1.08% and Titan Co down by 0.91% were the top losers.

Asian markets were trading in green; Hang Seng increased 553.43 points or 3.42% to 16,714.57, Shanghai Composite gained 14.07 points or 0.46% to 3,084.87, KOSPI rose 21.80 points or 0.93% to 2,370.23, Straits Times advanced 6.48 points or 0.21% to 3,136.59, Taiwan Weighted strengthened 213.90 points or 1.64% to 13,240.61, Jakarta Composite soared 16.12 points or 0.23% to 7,061.65 and Nikkei 225 surged 346.87 points or 1.28% to 27,546.61.