Markets trade flat as investors await GDP data for Q2

Indian equity markets traded flat in late morning deals as investors awaited the gross domestic product (GDP) data for Q2 and the U.S. Federal Reserve Chair Jerome Powell's speech due later in the day. Private report stated that India’s economy is expected to post annual growth of 6.2% in the three months to September 30, down from explosive growth of 13.5% in the previous quarter, which was inflated by comparison with weak activity during COVID-19 lockdowns. Trades look note of report that the Finance Ministry has called a meeting of CEOs of banks, including top six private sector lenders, on December 5 to discuss ways to promote cross-border trade in the rupee instead of the US dollar.

On the global front, Asian markets were trading mostly in green, as the first decrease in new Covid infections in more than a week in China is generating some positive sentiment. Back home, on the sectoral front, traders were seen pilling up position in Realty, Metal, Auto, Industrials and Utilities, while selling was witnessed in Consumer Durables, Bankex, IT, TECK and PSU. In stock specific development, NDTV surged after founders Prannoy Roy and Radhika Roy resigned as directors of the media firm.

The BSE Sensex is currently trading at 62685.05, up by 3.21 points or 0.01% after trading in a range of 62648.38 and 62865.74. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.35%, while Small cap index up by 0.42%.

The top gaining sectoral indices on the BSE were Realty up by 1.61%, Metal up by 1.35%, Auto up by 0.80%, Industrials up by 0.39% and Utilities up by 0.35%, while Consumer Durables down by 0.46%, Bankex down by 0.36%, IT down by 0.32%, TECK down by 0.17% and PSU down by 0.17% were the losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 1.67%, Dr. Reddy's Lab up by 1.05%, Bharti Airtel up by 0.87%, Tata Steel up by 0.85% and Asian Paints up by 0.81%. On the flip side, Indusind Bank down by 1.02%, SBI down by 0.97%, Tech Mahindra down by 0.75%, Bajaj Finance down by 0.62% and HCL Tech. down by 0.60% were the top losers.

Meanwhile, Moody's investors Service in its latest report has said that most rated companies in India can withstand a weaker rupee, although external factors like rising interest rates in developed economies and higher energy prices would increase currency volatility. In a commentary on non-financial companies in India, it said on November 25, the Indian rupee touched 81.67 versus the US dollar, after depreciating almost 10 per cent since the beginning of the year.

According to the report, the weakening rupee is credit negative for Indian companies that generate revenue in the domestic currency but depend on US dollar debt to fund their operations. It said a weaker rupee will also hurt companies with dollar-denominated costs but rupee-based revenues. However, it expects the negative credit implications for rated companies to be limited or temporary.

The report further said most rated companies have protections to limit the effect of currency fluctuations. These include natural hedges, some US dollar revenue and financial hedges, or a combination of these factors, which help limit the adverse effects on cash flow and leverage, even under a more severe deprecation scenario.

The CNX Nifty is currently trading at 18628.80, up by 10.75 points or 0.06% after trading in a range of 18616.55 and 18679.55. There were 31 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 2.86%, Bajaj Auto up by 1.49%, Mahindra & Mahindra up by 1.48%, Eicher Motors up by 1.13% and Dr. Reddy's Lab up by 1.05%. On the flip side, Apollo Hospital down by 1.20%, Indusind Bank down by 1.15%, SBI down by 1.02%, Infosys down by 0.73% and HCL Tech. down by 0.65% were the top losers.

Asian markets were trading mostly in green; Taiwan Weighted strengthened 169.91 points or 1.16% to 14,879.55, Shanghai Composite gained 5.34 points or 0.17% to 3,155.09, KOSPI rose 26.74 points or 1.1% to 2,460.13, Jakarta Composite soared 32.80 points or 0.47% to 7,044.87 and Hang Seng increased 156.69 points or 0.86% to 18,361.37. However, Nikkei 225 slipped 68.65 points or 0.24% to 27,959.19 and Straits Times trembled 1.05 points or 0.03% to 3,275.31.