Benchmarks continue to trade lower in morning deals

Indian equity benchmarks continued to trade lower in morning deals, led by losses in IT, TECK and Telecom stocks. Sentiments remained down-beat with private report stating that private equity and venture capital funds' investments in the country declined 5 per cent to $3.9 billion across 59 deals in July 2023. Traders overlooked the Reserve Bank of India's article stating that investment activity is gaining momentum and the envisaged capital expenditure is set to jump by over 80 per cent to Rs 1.71 lakh crore in the current fiscal (FY24). It also said improvement in capacity utilisation of the manufacturing sector, pick-up in credit demand and improving consumer sentiments are helping the capex cycle. Sectorally, power stocks remained in watch with a private report that India experienced a new peak in power demand, reaching a record 233 gigawatt (Gw) on Wednesday due to rising temperatures as the monsoon retreats across the country. On the global front, Asian markets are trading lower hammered by concerns about China's ailing economy and fears of U.S. rates staying higher for longer as long-term bond yields surged.

The BSE Sensex is currently trading at 64870.32, down by 280.70 points or 0.43% after trading in a range of 64799.17 and 65042.68. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.32%, while Small cap index was down by 0.15%.

The top gaining sectoral indices on the BSE were Power up by 0.73%, Utilities up by 0.55%, Capital Goods up by 0.25%, Bankex up by 0.17% and Industrials up by 0.05%, while IT down by 1.39%, TECK down by 1.23%, Telecom down by 0.80%, Metal down by 0.77% and Consumer Durables down by 0.71% were the top losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 0.86%, Larsen & Toubro up by 0.46%, ICICI Bank up by 0.34%, Tata Motors up by 0.07% and Hindustan Unilever up by 0.06%. On the flip side, Wipro down by 1.92%, Tech Mahindra down by 1.89%, TCS down by 1.72%, Infosys down by 1.33% and Titan Company down by 1.15% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) in its an article on 'State of the Economy' in the August Bulletin has said that risk of stagflation currently in India remains very low, with a probability of only 3 per cent, notwithstanding a sharp pick-up in inflation. Stagflation is the phase when an economy faces moderation in GDP growth and high inflation.

An article also underlined that in this stressed global environment, the Indian economy is gathering momentum in the second quarter of 2023-24. Domestic drivers such as private consumption and fixed investment are offsetting the drag from the contraction in exports.

Further, it said the uptick in inflation in its June reading mutated in July, with the unprecedented shock to tomato prices spilling over to prices of other vegetables. It said ‘While core inflation witnessed a moderation, headline inflation is expected to average well above 6 per cent in the second quarter. The article has been authored by a team led by Reserve Bank Deputy Governor Michael Debabrata Patra. The central bank, however, said the views expressed in the article are of the authors and do not represent the views of the Reserve Bank of India.

The CNX Nifty is currently trading at 19276.70, down by 88.55 points or 0.46% after trading in a range of 19258.30 and 19329.75. There were 11 stocks advancing against 39 stocks declining on the index.

The top gainers on Nifty were Axis Bank up by 0.89%, Dr. Reddy's Lab up by 0.55%, Cipla up by 0.54%, Larsen & Toubro up by 0.47% and Adani Ports &SEZ up by 0.35%. On the flip side, Coal India down by 2.07%, Wipro down by 2.05%, Tech Mahindra down by 1.87%, Hero MotoCorp down by 1.73% and TCS down by 1.65% were the top losers.

All Asian markets are trading lower; Taiwan Weighted lost 169.1 points or 1.02% to 16,347.56, Hang Seng declined 205.73 points or 1.14% to 18,120.90, Shanghai Composite weakened 1.77 points or 0.06% to 3,161.97, KOSPI dropped 19.01 points or 0.75% to 2,500.84, Jakarta Composite plunged 32.2 points or 0.47% to 6,868.34, Straits Times fell 22.06 points or 0.69% to 3,174.69 and Nikkei 225 slipped 262.69 points or 0.83% to 31,363.31.