Markets remain under pressure in late morning deals

Indian equity markets remained under pressure in late morning deals, mirroring weak cues from other Asian markets as investors fretted about more aggressive interest-rate hikes in the United States and surging COVID-19 cases in China. Meanwhile, the broader indices on the BSE were trading mixed. Sentiments remained weak as private report said that the Indian economy which claimed the title of the fastest-growing major economy in the previous fiscal is likely to lose its momentum in 2023 owing to higher borrowing costs and fading benefits from the Covid pandemic reopening. It stated gross domestic product may expand by 5.9% in the calendar year 2023 from an estimated 6.9% this year. Further, depreciation in Indian rupee against dollar also weighed down sentiments. Rupee weakened by 8 paise to 81.82 against the dollar at the Inter-bank Foreign Exchange market on account of increased demand for the American currency from importers and banks.

On the global front, Asian markets were mostly trading in red as traders reacted to the fresh COVID-19 outbreak and restrictions in China. 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, there were some buzz in steel related stocks as the government has cut the export duty on steel products and iron ore with effect November 19, 2022. As per government notification issued, exports of specified pig iron and steel products as well as iron ore pellets will attract 'nil' export duty. In stock specific development, Zomato fell after the company announced plans to lay off nearly 3-4 percent of its workforce.

The BSE Sensex is currently trading at 61220.84, down by 442.64 points or 0.72% after trading in a range of 61116.99 and 61456.33. There were 7 stocks advancing against 22 stocks declining on the index, while 1 stock remained unchanged.

The broader indices were trading in Mixed; the BSE Mid cap index was down by 0.16%, while Small cap index up by 0.24%.

The top gaining sectoral indices on the BSE were Telecom up by 0.29%, Consumer Durables up by 0.07%, Industrials up by 0.06%, Auto up by 0.04% and Consumer Disc up by 0.02%, while IT down by 1.22%, Energy down by 1.16%, Oil & Gas down by 1.14%, TECK down by 0.94% and Power down by 0.65% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 0.88%, Axis Bank up by 0.86%, Hindustan Unilever up by 0.48%, ICICI Bank up by 0.42% and Maruti Suzuki up by 0.41%. On the flip side, Bajaj Finance down by 1.62%, Reliance Industries down by 1.56%, TCS down by 1.43%, Infosys down by 1.40% and HDFC down by 1.37% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) article has said that with headline inflation beginning to show signs of easing, the domestic macroeconomic outlook appears to be resilient and on a course for about 7 per cent GDP growth in the current fiscal (FY23) though India is still sensitive to global headwinds. It said urban demand appears robust, while rural demand is muted but more recently picking up traction.

The article has stated that the outlook for the global economy remains clouded with downside risks. Global financial conditions have been tightening and deteriorating market liquidity is amplifying financial price movements. Markets are now pricing in moderate increases in policy rates and risk-on appetite has returned. In India, supply responses in the economy are gaining strength.

It further said ‘based on high frequency indicators, our nowcasting and full information models peg real GDP growth in the July-September quarter between 6.1 per cent and 6.3 per cent. If this is realised, India is on course for a growth rate of about 7 per cent in 2022-23.’ It added that in the third quarter supply responses in the economy are gaining strength. In the financial sector, it said system liquidity is normalising in consonance with the stance of monetary policy but it is still in surplus mode, with the RBI absorbing about Rs 1.5 lakh crore on a daily basis on average.

The CNX Nifty is currently trading at 18181.10, down by 126.55 points or 0.69% after trading in a range of 18146.85 and 18262.30. There were 15 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were BPCL up by 0.92%, Axis Bank up by 0.91%, Bharti Airtel up by 0.76%, Hindustan Unilever up by 0.50% and ICICI Bank up by 0.47%. On the flip side, ONGC down by 4.73%, SBI Life Insurance down by 2.41%, Bajaj Finance down by 1.71%, Reliance Industries down by 1.48% and Infosys down by 1.46% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 392.80 points or 2.18% to 17,599.74, Shanghai Composite declined 22.66 points or 0.73% to 3,074.58, Taiwan Weighted dropped 67.99 points or 0.47% to 14,437.00, Straits Times trembled 25.76 points or 0.79% to 3,246.47, KOSPI fell 29.26 points or 1.2% to 2,415.22 and Jakarta Composite lost 24.38 points or 0.34% to 7,057.80, while Nikkei 225 surged 6.15 points or 0.02% to 27,905.92.