Benchmarks trade flat in morning deals

Indian equity benchmarks erased initial losses and were trading flat in morning deals, ahead of weekly F&O expiry later in the day. Traders took some support with B B Swain, Secretary to the Union Ministry for Micro, Small and Medium Enterprises (MSMEs) stating that the government has acknowledged MSMEs' contribution to the country's economic growth, and the Budget 2023-24 has given a boost to the fund-starved sector with higher credit flow and by simplifying compliances. Traders also took a note of Union Minister of State for Commerce and Industry Som Prakash’s statement that the industrial growth during 2021-22 was 11.7% over the corresponding period of the last year. He also highlighted that the government has undertaken various steps to boost industrial performance. Meanwhile, SEBI has notified rules asking all market intermediaries and companies to make regulatory payments to it by way of direct credit into the bank account through digital payment systems.

On the global front, Asian markets are trading mixed as risk sentiment soured amid expectations that the Fed will retain a sufficiently restrictive stance of policy for some time to cool prices. U.S.-China tensions also weigh after U.S. President Joe Biden vowed he would not hesitate to defend his country's interests against China in the backdrop of the downing of an alleged Chinese spy balloon by the U.S. air force.

The BSE Sensex is currently trading at 60691.88, up by 28.09 points or 0.05% after trading in a range of 60472.81 and 60740.39. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.01%, while Small cap index was up by 0.02%.

The top gaining sectoral indices on the BSE were Industrials up by 0.55%, Capital Goods up by 0.40%, IT up by 0.19%, FMCG up by 0.10% and Metal up by 0.07%, while Utilities down by 0.79%, Power down by 0.78%, Telecom down by 0.57%, Bankex down by 0.39% and Consumer Durables down by 0.17% were the top losing indices on BSE.

The top gainers on the Sensex were Bajaj Finance up by 1.53%, Bajaj Finserv up by 1.23%, Larsen & Toubro up by 0.82%, Asian Paints up by 0.71% and Reliance Industries up by 0.68%. On the flip side, Bharti Airtel down by 0.98%, Tata Motors down by 0.83%, Maruti Suzuki down by 0.61%, Axis Bank down by 0.57% and HDFC Bank down by 0.52% were the top losers.

Meanwhile, the Reserve Bank of India’s Governor Shaktikanta Das has there is no proposal to increase the overseas investment limits for domestic mutual funds at the moment. He acknowledged that there have been requests from mutual funds and other market players for relaxations of the limits.

He stated ‘We have examined that. But we have not taken a positive decision on it yet. There is no proposal to increase the limits at the moment.’ Meanwhile, Deputy Governor T Rabi Sankar said the same issue had come up a year ago as well and it was decided to maintain the status quo then. It can be noted that there is an overall industry-level limit of $7 billion for mutual funds. The RBI regulates the fund inflows and outflows into the country.

Besides, capital markets regulator Securities and Exchange Board of India (Sebi) had in June last year permitted mutual funds to again invest in foreign stocks within the aggregate mandated limit of $7 billion after a correction in stocks. In January 2022, Sebi asked mutual fund houses to stop taking fresh subscriptions in schemes investing in overseas stocks. The directive to stop subscriptions was mainly on account of the mutual fund industry crossing the mandated limit of $7 billion for overseas investments.

The CNX Nifty is currently trading at 17848.80, down by 22.90 points or 0.13% after trading in a range of 17779.80 and 17887.75. There were 22 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were Bajaj Finance up by 1.55%, Divi's Lab up by 1.46%, Grasim Industries up by 1.36%, Bajaj Finserv up by 1.16% and BPCL up by 0.93%. On the flip side, Adani Enterprises down by 9.31%, Adani Ports &Special down by 3.72%, Hero MotoCorp down by 1.33%, Tata Motors down by 0.98% and UPL down by 0.94% were the top losers.

Asian markets are trading mixed; Straits Times fell 29.91 points or 0.89% to 3,358.61, Nikkei 225 slipped 33.21 points or 0.12% to 27,573.25, Taiwan Weighted lost 26.28 points or 0.17% to 15,591.89 and KOSPI dropped 2.02 points or 0.08% to 2,481.62.

On the flip side, Jakarta Composite gained 8.93 points or 0.13% to 6,949.05, Hang Seng advanced 73.27 points or 0.34% to 21,356.79 and Shanghai Composite strengthened 19.91 points or 0.61% to 3,252.02.