Bears hold tight grip over Dalal Street

Bears were holding a tight grip over the Dalal Street, with both Sensex and Nifty trading in deep red, on the back of negative cues from other Asian markets. Heavy selling at Metal and Realty counters dragged the markets near their intraday low points, while Indusind Bank lost the most on the BSE. Investors were concerned ahead of the minutes of the Fed's latest policy meeting due later today. Traders overlooked reports that India’s services sector growth expanded further in the month of December, with a quicker upturn in new business boosting output growth. More jobs were created and companies remained strongly upbeat towards the year-ahead outlook for business activity. As per the survey report, the seasonally adjusted S&P Global India Services PMI Business Activity Index surged to 58.5 in December from 56.4 in November. Further, the S&P Global India Composite PMI Output Index -- which measures both manufacturing and services -- improved to 59.4 in December from 56.7 in November.

On the global front, Asian markets were trading mostly in red, as the manufacturing sector in Japan continued to contract in December, and at a slightly faster rate, with a manufacturing PMI score of 48.9. That's down from 49.0 in November and it moves further beneath the boom-or-bust line of 50 that separates expansion from contraction. The greatest influence on decline in the headline PMI number came from its largest component, new orders.

The BSE Sensex is currently trading at 60652.71, down by 641.49 points or 1.05% after trading in a range of 60633.32 and 61327.21. There were 4 stocks advancing against 26 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 1.27%, while Small cap index was down by 1.05%.

There were no gaining sectoral indices on the BSE, while Metal down by 2.75%, Realty down by 2.30%, PSU down by 1.81%, Utilities down by 1.66% and Power down by 1.44% were the top losing indices on BSE.

The top gainers on the Sensex were Ultratech Cement up by 0.29%, Asian Paints up by 0.27%, Maruti Suzuki up by 0.16% and Sun Pharma up by 0.03%. On the flip side, Indusind Bank down by 2.28%, Tata Motors down by 2.03%, Tata Steel down by 1.86%, Wipro down by 1.76% and Power Grid down by 1.69% were the top losers.

Meanwhile, economic think tank the Global Trade Research Initiative (GTRI) has said that the Indian economy and exports will be moderately impacted in 2023 by weak global demand and recession in large economies. To improve its current account, the country should aim to cut energy import bill. India will pay $270 billion in imports of crude oil and coal, which is about 40 per cent of total merchandise import bill.

GTRI has stated that India must re-energize exploration of local oil fields and enhance production through coal mines. Any development will cut the energy import bill substantially and improve the current account. It also said the US effort to create alternate supply chains excluding China is gradually leading to restructuring of global supply chains and relocation of few large manufacturing firms shows that India is in a good position to benefit from this trend. It said India should do so without compromising its strategic autonomy, adding that in various free trade agreements (FTAs) under negotiations, India should carefully evaluate the impact of new provisions on domestic policies. Developed countries including the US and the EU use such provisions in creating non-tariff barriers against exports from partner countries.

On trade data, it said India's exports are expected to touch $440-450 billion in 2022 despite the global uncertainties as against $ 395 billion in 2021. India's merchandise imports are also likely to be around $ 725 billion in 2022, higher than $ 573 billion in 2021.

The CNX Nifty is currently trading at 18061.40, down by 171.15 points or 0.94% after trading in a range of 18037.85 and 18243.00. There were 9 stocks advancing against 41 stocks declining on the index.

The top gainers on Nifty were Divi's Laboratories up by 1.33%, HDFC Life Insurance up by 0.69%, Ultratech Cement up by 0.31%, Asian Paints up by 0.29% and Maruti Suzuki up by 0.21%. On the flip side, Hindalco down by 3.42%, JSW Steel down by 3.10%, Coal India down by 3.03%, ONGC down by 2.61% and Indusind Bank down by 2.22% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 slipped 377.64 points or 1.45% to 25,716.86, Taiwan Weighted dropped 24.99 points or 0.18% to 14,199.13, Jakarta Composite lost 23.95 points or 0.35% to 6,864.81 and Straits Times trembled 0.97 points or 0.03% to 3,244.83, while Shanghai Composite gained 5.96 points or 0.19% to 3,122.47, KOSPI rose 37.30 points or 1.68% to 2,255.98 and Hang Seng increased 494.97 points or 2.46% to 20,640.26.