Domestic equity indices remain in red

Domestic equity indices remained in red and traded with cut over half a percent in late morning deals on account of selling by fund and retail investors. Meanwhile, broader indices on the BSE were also trading with losses in the range of 0.30-1.00%. Weak cues from global markets, on concerns over the true scale of infections in China and the possibility of higher interest rates leading to a recession, dampened domestic sentiments. The market sentiment was further being weighed down by the weakness in rupee which fell  by 4 paise to 82.84 against the US dollar due to demand for the US currency from banks and importers. Besides, some cautiousness also came in with RBI Monetary Policy Committee (MPC) Member Ashima Goyal’s statement that the government should not go in for an 'aggressive fiscal consolidation' in the upcoming budget as global risks have not abated.

On the global front, Asian markets were mostly trading in red following the broadly negative cues from US markets overnight, amid ongoing concerns over the deteriorating health of the global economy. Back home, all the sectoral indices on the BSE were trading in red led by Power, Realty, Utilities, FMCG and Consumer Durables. In stock specific development, Ashoka Buildcon gained after the company won an order worth of Rs 755 crore.

The BSE Sensex is currently trading at 60593.73, down by 316.55 points or 0.52% after trading in a range of 60479.06 and 60685.13. 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 0.99%, while Small cap index down by 0.32%.

The top losing sectoral indices on the BSE were Power down by 0.98%, Realty down by 0.94%, Utilities down by 0.91%, FMCG down by 0.88% and Consumer Durables down by 0.85%, while there were no gaining indices on BSE.

The only gainer on the Sensex was Bharti Airtel up by 0.41%. On the flip side, Ultratech Cement down by 1.89%, Tata Motors down by 1.66%, Hindustan Unilever down by 1.40%, ICICI Bank down by 0.91% and Titan down by 0.90% were the top losers.

Meanwhile, India Ratings and Research (Ind-Ra) in its latest report has said that despite the government's high-octane push to boost manufacturing through the 'Make in India' initiative, foreign investors continue to chase bets in the services sector. It said this could be because doing business in the services sector is less complicated than doing business in the manufacturing sector in India. It also said a bulk of the foreign direct investment (FDI) in manufacturing is not greenfield or fresh investments which should otherwise be the aspirational aspect.

The agency said FDI increased to $153.01 billion in the services sector during April 2014 to March 2022 from $80.51 billion during to April 2000 to March 2014, while the increase in manufacturing was less fast at $94.32 billion as against $77.11 billion. It reminded that in 2014, India launched a flagship programme called 'Make in India' to facilitate investments across sectors, but with a special focus to build a world-class manufacturing sector and followed it up with the PLI scheme across 14 manufacturing sectors.

Ind-Ra stated that the services sector accounted for the highest share in FDI between 2000-2014 as well, adding that within services, trading, telecommunications, banking/insurance, IT/business outsourcing and hotels/tourism are the favourites. In manufacturing, the FDI has been concentrated in segments such as auto, chemicals, drugs and pharmaceuticals, metallurgical and food processing. It also said the country has done well among emerging market economies in terms of attracting FDI, with its share increasing to 6.65 per cent in 2020 and declining due to COVID impact to 2.83 per cent in 2021. From a region perspective, it noted FDI is highly clustered around few states, hinting that the foreign fund flows may not be helping the cause of broad based development across the country.

The CNX Nifty is currently trading at 18023.15, down by 99.35 points or 0.55% after trading in a range of 17992.80 and 18061.00. There were 3 stocks advancing against 47 stocks declining on the index.

The only gainers on Nifty were ONGC up by 0.80%, Bharti Airtel up by 0.35% and UPL up by 0.04%. On the flip side, Ultratech Cement down by 1.95%, Tata Consumer down by 1.94%, Apollo Hospital down by 1.82%, Grasim Industries down by 1.64% and Tata Motors down by 1.61% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 slipped 311.14 points or 1.18% to 26,029.36, Taiwan Weighted dropped 88.08 points or 0.62% to 14,085.02, Straits Times trembled 26.06 points or 0.8% to 3,240.91, Shanghai Composite declined 13.95 points or 0.45% to 3,073.45, KOSPI fell 36.94 points or 1.62% to 2,243.51 and Hang Seng decreased 201.15 points or 1.01% to 19,697.76. However, Jakarta Composite soared 5.23 points or 0.08% to 6,855.75.