Markets remain in deep red on weak cues from global markets

Domestic equity indices remained in deep red and traded with cut of over one percent in late morning deals, on account of fresh selling by funds and retail investors.  Sentiments remained weak on negative cues from global markets on concerns over the Federal Reserve's continued policy tightening and rising COVID cases in China. Depreciation in Indian rupee against dollar also weighed down sentiments. Rupee weakened by 9 paise to 82.88 against the dollar at the Inter-bank Foreign Exchange market on account of increased demand for the American currency from importers and banks. Almost all the sectoral indices on BSE were trading into negative territory; however stocks from Consumer Discretionary counter were the only exception. Stocks from Utilities, Power, Metal, Telecom and PSU counters were the prominent losers of the session.

On the global front, Asian markets were trading in red as rate hike and recession worries rattled investors. Back home, in stock specific development, Droneacharya Aerial Innovations made a stellar debut as shares were listed at Rs 102 per share, a whopping 89 per cent premium over its issue price of Rs 54 per share on the BSE.

The BSE Sensex is currently trading at 60206.05, down by 620.17 points or 1.02% after trading in a range of 60136.59 and 60546.88. There was 1 stock advancing against 29 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 2.29%, while Small cap index down by 2.65%.

The only gaining sectoral index on the BSE was Consumer Discretionary up by 0.05%, while Utilities down by 2.94%, Power down by 2.79%, Metal down by 2.44%, Telecom down by 2.35% and PSU down by 2.33% were the top losing indices on BSE.

The only gainer on the Sensex was Nestle up by 0.68%. On the flip side, Tata Steel down by 3.07%, Tata Motors down by 2.97%, SBI down by 2.14%, Bajaj Finserv down by 2.07% and Wipro down by 1.89% were the top losers.

Meanwhile, amid demands for snapping trade ties with China for its transgressions on the border, former Niti Aayog Vice Chairman Arvind Panagariya has opined that cutting trade with Beijing at this juncture would amount to sacrificing India's potential economic growth. Instead, he suggested that India should try to enter into free trade agreements (FTA) with countries such as the UK and the European Union to expand its trade.

Panagariya said ‘engaging China in a trade war at this juncture will mean sacrificing a considerable part of our potential growth... purely on economic grounds, it will be unwise to take any action in response to it (transgressions on the border). He said both countries can play the trade sanctions game but the ability of a $17 trillion economy (China) to inflict injury on a $3 trillion economy (India) is far greater than the reverse. He observed that ‘now there are some who want trade sanctions on China to 'punish' it for its transgressions on the border... if we try to punish China, it will not sit back, as amply illustrated by its response to sanctions by even the mighty United States.’ He pointed out that even a large economy such as the US has not been very successful with its sanctions either against China or even Russia.

To reduce the trade deficit with China, he suggested that the idea ought to expand trade faster with other trading partners rather than cutting it with Beijing through a blunt instrument such as trade sanctions. He said ‘we should take advantage of India's excellent growth prospects for the next decade and concentrate on growing the economy bigger as fast as possible. Once we are the third largest economy, our sanctions threats are likely to carry greater credibility’.

The CNX Nifty is currently trading at 17911.15, down by 216.20 points or 1.19% after trading in a range of 17910.45 and 18050.45. There were 3 stocks advancing against 47 stocks declining on the index.

The only gainers on Nifty were Divi's Lab up by 0.98%, Nestle up by 0.46% and Cipla up by 0.37%. On the flip side, Adani Ports & SEZ down by 4.01%, Tata Steel down by 3.53%, Hindalco down by 3.49%, Tata Motors down by 3.25% and Adani Enterprises down by 3.06% were the top losers.

All Asian markets were trading lower; Nikkei 225 slipped 278.17 points or 1.05% to 26,229.70, Taiwan Weighted dropped 171.31 points or 1.19% to 14,271.63, Straits Times trembled 16.18 points or 0.49% to 3,253.35, Shanghai Composite declined 8.86 points or 0.29% to 3,045.57, KOSPI fell 40.39 points or 1.71% to 2,316.34, Jakarta Composite lost 15.98 points or 0.23% to 6,808.45 and Hang Seng decreased 122.02 points or 0.62% to 19,557.20.