Markets trade in red on weak cues from global markets

With a gap-down opening Indian equity benchmarks have extended their previous session's losses and are now trading lower by over half a percent on Thursday, which dragged both the Sensex and Nifty below their psychological 60,600 and 18050 levels respectively. Meanwhile, the session was also proving weak for broader indices on the BSE which are trading with losses in the range of 0.25-0.45%. Weak cues from global markets weighted on the sentiments. Traders also remained concerned as a private report said that India's GDP growth will slow down to 5.5 per cent in FY24 from the 6.9 per cent expected in the current fiscal 2022-23. The slowdown was attributed to slowing global growth and tightening of monetary policies. It said India will be among the lesser affected economies in the world, but made it clear that the world's fifth largest economy is not immune from global headwinds.

On the global front, Asian markets were trading mostly lower on Thursday following the broadly negative cues from global markets overnight, as a stronger U.S. dollar weighed on crude oil prices and on most of its major Asian rivals. The US markets ended lower on Wednesday amid Republican gains in midterm elections appeared more modest than some expected, with investors also focusing on upcoming inflation data that will provide clues about the severity of future interest rate hikes.

Back home, there were some reaction in coal related stocks as the Centre said that the demand for coal in India is still to reach its peak and the dry fuel will continue to play a key role in the energy mix till 2040 and beyond. Therefore, shift from coal will not happen in foreseeable future in the country.

The BSE Sensex is currently trading at 60572.01, down by 461.54 points or 0.76% after trading in a range of 60511.99 and 60848.73. There were 5 stocks advancing against 25 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.42%, while Small cap index down by 0.26%.

The top gaining sectoral indices on the BSE were Healthcare up by 0.45%, Telecom up by 0.24%, Consumer Disc up by 0.02% and Basic Materials up by 0.01%, while Auto down by 1.42%, IT down by 0.73%, Consumer Durables down by 0.72%, Bankex down by 0.67% and Capital Goods down by 0.57% were the top losing indices on BSE.

The top gainers on the Sensex were Dr. Reddy's Lab up by 1.16%, Bharti Airtel up by 0.76%, Hindustan Unilever up by 0.47%, Kotak Mahindra Bank up by 0.30% and Sun Pharma up by 0.21%. On the flip side, Axis Bank down by 2.68%, Tech Mahindra down by 1.84%, Mahindra & Mahindra down by 1.66%, Ultratech Cement down by 1.30% and Reliance Industries down by 1.08% were the top losers.

Meanwhile, the Government has allowed international trade settlements in the Indian rupee for export promotion schemes under foreign trade policy (FTP).  The Government of India has made suitable amendments in the Foreign Trade Policy and Handbook of Procedures to allow for international trade settlement in Indian rupees (INR) i.e. invoicing, payment, and settlement of exports/imports in Indian rupees.

It stated that given the rise in interest in internationalisation of Indian Rupee, the given Policy amendments have been undertaken to facilitate and to bring ease in international trade transactions in Indian Rupees. It also mentioned that changes have been notified for imports for exports, export performance for recognition as Status Holders, realisation of export proceeds under advance authorisation and Duty-Free Import Authorisation schemes, and realisation of export proceeds under export promotion capital goods scheme.

The Directorate General of Foreign Trade (DGFT), under the commerce ministry, has already allowed invoicing, payment and settlement of exports and imports in Indian rupee, a move aimed at facilitating trade in the domestic currency. In July, the Reserve Bank of India (RBI) had asked banks to put in place additional arrangements for export and import transactions in Indian rupees in view of increasing interest of the global trading community in the domestic currency.

The CNX Nifty is currently trading at 18029.85, down by 127.15 points or 0.70% after trading in a range of 18027.50 and 18103.10. There were 12 stocks advancing against 38 stocks declining on the index.

The top gainers on Nifty were Cipla up by 1.38%, Dr. Reddy's Lab up by 0.90%, Hindustan Unilever up by 0.63%, Divi's Lab up by 0.61% and Bharti Airtel up by 0.60%. On the flip side, Tata Motors down by 4.14%, Axis Bank down by 2.71%, Mahindra & Mahindra down by 2.14%, Tech Mahindra down by 1.79% and Apollo Hospital down by 1.71% were the top losers.

Asian markets were trading mostly in red, Hang Seng decreased 323.88 points or 1.98% to 16,034.64, Shanghai Composite declined 16.05 points or 0.53% to 3,032.12, Taiwan Weighted dropped 156.45 points or 1.15% to 13,482.36, KOSPI fell 15.70 points or 0.65% to 2,408.71, Jakarta Composite lost 84.45 points or 1.19% to 6,985.63 and Nikkei 225 slipped 285.75 points or 1.03% to 27,430.68. However, Straits Times advanced 10.18 points or 0.32% to 3,175.68.