Domestic markets trade under pressure in early deals

Indian equity benchmarks made negative start on Monday tracking weakness in Asian counterparts. Soon, markets extended their losses and are trading deeply in red with cut of over 0.80% each in early deals. Foreign fund outflows dented sentiments in the markets. Foreign institutional investors (FIIs) net offloaded shares worth Rs 751.20 crore on 18 November, according to the provisional data available on NSE. Traders were concerned as the latest payroll data released by the Employees’ Provident Fund Organisation showed the number of fresh formal jobs created fell for the second consecutive month in September, declining 9 per cent sequentially to 930,000. Enrolment of new female subscribers fell faster (11.39 per cent) than their male counterparts (8.13 per cent) in September, compared with the previous month. Markets participants largely overlooked former Niti Aayog Vice-Chairman Rajiv Kumar’s statement that India will still grow at 6-7 per cent in the next 2023-24 fiscal even as the economy may be affected by uncertain global conditions.

Most of the Asian markets are trading lower, despite the broadly positive cues from global markets on Friday, as traders reacted to the fresh COVID-19 outbreak and restrictions in China with a 5-day lockdown in Guangzhou. Traders are also concerned about the outlook for interest rate hikes ahead of the release of minutes of the US Fed's last meeting on Wednesday. Back home, banking stocks were in focus S&P Global Market Intelligence in a report on the Indian banking sector said that the rising interest rates will enable Indian banks to continue posting good profits during the remaining part of FY23. In stock specific development, PB Fintech gains on acquiring 27% stake in YKNP Marketing Management.

The BSE Sensex is currently trading at 61143.11, down by 520.37 points or 0.84% after trading in a range of 61116.99 and 61456.33. There were 3 stocks advancing against 27 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.43%, while Small cap index was down by 0.09%.

The top losing sectoral indices on the BSE were Oil & Gas down by 1.30%, Energy down by 1.22%, Power down by 1.08%, Utilities down by 1.07%, Realty down by 0.93%, while there was no gainer on the BSE sectoral front.

The top gainers on the Sensex were Bharti Airtel up by 0.42%, Hindustan Unilever up by 0.36% and Axis Bank up by 0.16%. On the flip side, Bajaj Finance down by 2.01%, ITC down by 1.83%, Reliance Industries down by 1.48%, Mahindra & Mahindra down by 1.46% and HDFC down by 1.44% were the top losers.

Meanwhile, amid growing fears of the world slipping into a recession, former Niti Aayog Vice-Chairman Rajiv Kumar has said even as the economy may be affected by uncertain global conditions India will still grow at 6-7 per cent in the next 2023-24 fiscal. He further said there is a synchronized downturn in the US, Europe, Japan and also in China and that could take the global economy into a recession in the coming months. He added ‘Thankfully, there is no such prospect of recession in India, because although our growth may be negatively affected by the global conditions, we will still manage to grow at 6-7 per cent in 2023-24’.

Regarding high inflation, Kumar said retail inflation will probably be in the range of 6-7 per cent for some more time. He said ‘After that, my estimate is that it should begin to peak and then come down’. He added that depends a lot on global oil prices as it can continue to rise because of the continued conflict in Ukraine. He noted that ‘But otherwise domestic drivers of inflation will cool down’. Indicating easing of the price situation, retail inflation moderated to 6.7 per cent in October while the wholesale price index fell to a 19-month low mainly on account of subdued rates of food items.

About the impact of a weakening Indian rupee on the common man, he said the common Indian does not use a lot of imported goods or services in their consumption basket. According to him, the rupee which is near its real value is much better for the economy than the appreciated rupee and depreciated rupee doesn't pose many downside risks. On India's widening trade deficit, he said with the negative growth of exports in October, it is clear that the country needs a real policy focus on this area on how to expand its exports of both goods and services.

The CNX Nifty is currently trading at 18152.85, down by 154.80 points or 0.85% after trading in a range of 18146.85 and 18262.30. There were 8 stocks advancing against 42 stocks declining on the index.

The top gainers on Nifty were BPCL up by 0.87%, Britannia Industries up by 0.38%, Axis Bank up by 0.27%, Hindustan Unilever up by 0.25% and Divi's Lab up by 0.20%. On the flip side, ONGC down by 4.16%, SBI Life Insurance down by 2.64%, Bajaj Finance down by 2.13%, Adani Enterprises down by 1.86% and Adani Ports & SEZ down by 1.86% were the top losers.

Asian markets are trading mostly in red; Straits Times declined 27.61 points or 0.84% to 3,244.62, Hang Seng slipped 367.82 points or 2.04% to 17,624.72, Taiwan Weighted lost 58.15 points or 0.40% to 14,446.84, KOSPI dropped 24.93 points or 1.02% to 2,419.55, Jakarta Composite fell 15.15 points or 0.21% to 7,067.03 and Shanghai Composite was down by 25.15 points or 0.81% to 3,072.09, while Nikkei 225 was up by 11.80 points or 0.04% to 27,911.57.