Benchmarks remain in red in morning deals

Indian equity benchmarks erased most of their initial losses but continued to trade in red in morning deals, in line with weak trend in Asian markets and fresh foreign fund outflows. Rising interest rates globally also dampened investor sentiments. Some concern also came as the minutes of the June MPC released by the central bank revealed that sounding a note of caution, RBI’s rate-setting panel member Jayanth R Varma opined that monetary policy is now dangerously close to levels at which it can inflict significant damage to the economy. However, losses remain capped as traders took some support with India and the US have stating that they are looking forward to the reconvening of the India-US Trade Policy Forum later this year to further enhance trade relationship and identify new areas for engagement. A joint statement issued after a meeting between Prime Minister Narendra Modi and US President Joe Biden showed that the two countries have also taken steps towards deepening bilateral cooperation to strengthen economic relationship, including trade ties.

On the global front, Asian markets are trading mostly in red after rate hikes from policymakers in England, Norway and Switzerland pushed global bond yields higher. US Fed Chair Jerome Powell also reiterated plans to continue raising interest rates during his second day of testimony on Capitol Hill. Back home, stocks related to Auto component industry remained in watch as Crisil Ratings said automotive components makers in India are set to register 10-12 per cent growth in revenue during the financial year 2023-24 (FY24). It attributed the growth to continued domestic growth -- buoyed by robust demand from automobile manufacturers and aftersales demand from services.

The BSE Sensex is currently trading at 63157.68, down by 81.21 points or 0.13% after trading in a range of 62874.12 and 63180.52. There were 10 stocks advancing against 20 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.60%, while Small cap index was down by 0.52%.

The top gaining sectoral indices on the BSE were Telecom up by 0.39% and Bankex up by 0.02%, while Oil & Gas down by 1.17%, Consumer Durables down by 1.15%, Metal down by 0.93%, Energy down by 0.87% and IT down by 0.84% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 1.64%, NTPC up by 1.27%, Indusind Bank up by 1.13%, Asian Paints up by 0.94% and HDFC up by 0.70%. On the flip side, Tech Mahindra down by 1.61%, Power Grid Corporation down by 1.50%, Tata Motors down by 1.15%, Tata Steel down by 1.08% and SBI down by 1.07% were the top losers.

Meanwhile, Crisil Ratings has said that automotive components makers in India are set to register 10-12 per cent growth in revenue during the financial year 2023-24 (FY24). It attributed the growth to continued domestic growth -- buoyed by robust demand from automobile manufacturers and aftersales demand from services. 

It stated this is despite exports continuing to remain sluggish. Further, it noted moderation in prices of key raw materials will support their operating margin to reach the pre-pandemic levels of 12.0-12.5 per cent against 11.9 last year.

Anuj Sethi, Senior Director, CRISIL Ratings, said ‘Improving semi-conductor availability will support supplies of passenger vehicles and premium motorcycles. Exports, the second-largest revenue contributor, will remain sluggish amid continuing headwinds in key markets in Asia, Africa, and Latin America. Lastly, revenue from the aftermarket segment, which accounts for the balance, will grow at a steady 6-8 per cent, supported by strong automotive sales in past fiscals.’

The CNX Nifty is currently trading at 18719.60, down by 51.65 points or 0.28% after trading in a range of 18647.10 and 18756.40. There were 11 stocks advancing against 39 stocks declining on the index.

The top gainers on Nifty were Bharti Airtel up by 1.76%, Dr. Reddy's Lab up by 1.54%, NTPC up by 1.36%, Indusind Bank up by 1.19% and Asian Paints up by 0.93%. On the flip side, Adani Enterprises down by 5.09%, Adani Ports &SEZ down by 3.57%, BPCL down by 2.57%, HDFC Life Insurance down by 1.84% and Hindalco down by 1.73% were the top losers.

Asian markets are trading mostly in red; Hang Seng declined 373.31 points or 1.98% to 18,845.04, KOSPI dropped 21.45 points or 0.83% to 2,572.25, Jakarta Composite plunged 7.45 points or 0.11% to 6,644.81, Straits Times fell 22.26 points or 0.69% to 3,200.17 and Nikkei 225 slipped 563.53 points or 1.69% to 32,701.35.