Domestic indices remain flat in late morning deals

Domestic equity indices remained flat and were trading slightly higher in late morning deals on account of buying in HDFC Bank, Kotak Mahindra Bank and JSW Steel. Meanwhile, broader indices outperformed their large peers with BSE Mid cap index and Small cap index gaining in the range of 0.35-0.45%. Traders were getting some encouragement with private report stating that the Indian economy is likely to post better than anticipated growth in the second quarter (July-September) owing to robust urban consumption and expansion in services. Back home, on the BSE sectoral front, traders were seen pilling up position in Healthcare, Metal, Telecom, Capital Goods and Industrials, while selling was witnessed in IT, TECK, Oil & Gas, FMCG and Energy. 

On the global front, Asian markets were trading mostly in red as investors assess key economic data out from Japan. The world’s third largest economy saw its core inflation rate rise to 2.9% in October, higher than the 2.8% seen in September. The headline inflation rate for October came in at 3.3%, accelerating from the 3% seen in from the month before. In the stock specific development, Lupin gained after the company received a USFDA nod for Bromfenac Ophthalmic solution and tentative approval for Canagliflozin tablets.

The BSE Sensex is currently trading at 66038.40, up by 20.59 points or 0.03% after trading in a range of 65960.65 and 66101.64. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.35%, while Small cap index up by 0.44%.

The top gaining sectoral indices on the BSE were Healthcare up by 0.96%, Metal up by 0.67%, Telecom up by 0.52%, Capital Goods up by 0.49% and Industrials up by 0.45%, while IT down by 0.50%, TECK down by 0.47%, Oil & Gas down by 0.28%, FMCG down by 0.20% and Energy down by 0.04% were the top losing indices on BSE.

The top gainers on the Sensex were JSW Steel up by 1.25%, NTPC up by 0.87%, Axis Bank up by 0.61%, HDFC Bank up by 0.59% and Kotak Mahindra Bank up by 0.41%. On the flip side, HCL down by 1.33%, Wipro down by 0.87%, TCS down by 0.83%, Tata Motors down by 0.77% and Infosys down by 0.60% were the top losers.

Meanwhile, additional Secretary in the department of commerce Rajesh Agarwal has said that the Micro, Small and Medium Enterprises (MSMEs) are getting greater importance in the upcoming Free Trade Agreements (FTAs) as these pacts provide huge opportunities for them to participate in global trade. He noted that FTAs can enable better integration of MSMEs with global value chains. However, he said there are a few key challenges that need to be focussed on for the sector, including information asymmetry, access to affordable finance, reduction in regulatory burden, access to new markets, and capacity building through skill development programmes.

Agarwal has stated that the FTAs bring advantages to MSMEs through rationalisation of customs duties and that enables them to become a part of Global Value Chains (GVCs). Lowering of tariff disparities across geographies eases movement of goods and enables manufacturing to become efficient. He said the sector is important as it accounts for 30 per cent in GDP and about 50 per cent in the country's exports. Nowadays in FTAs, countries talk about addressing the information asymmetries that MSMEs face in trade through sharing of best practices and other trade enabling knowledge.

He further said all FTAs are talking about digitisation of processes, e-documentation, e-billing, digitisation of custom processes and entire logistics involved in exports. At present, India is negotiating FTAs with key trade partners like the European Union, the UK, and Australia. He said ‘in all these FTAs we are looking for tariff concessions which will drive jobs and MSMEs’. He added that while FTAs bring market opportunities they also impose tougher standards on climate and labour which will also require effort and costs to comply with.

The CNX Nifty is currently trading at 19813.25, up by 11.25 points or 0.06% after trading in a range of 19786.60 and 19832.85. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Cipla up by 2.66%, Divi's Lab up by 2.17%, Hindalco up by 1.38%, JSW Steel up by 1.22% and Dr. Reddy's Lab up by 1.04%. On the flip side, HCL down by 1.26%, Tata Motors down by 0.87%, Wipro down by 0.82%, Apollo Hospital down by 0.76% and Adani Ports down by 0.76% were the top losers.

Asian markets were trading mostly in red; Hang Seng declined 253.05 points or 1.41% to 17,657.79, Taiwan Weighted lost 10.33 points or 0.06% to 17,284.22, Straits Times fell 17.82 points or 0.57% to 3,097.10, KOSPI dropped 17.40 points or 0.69% to 2,497.56, Shanghai Composite weakened 21.68 points or 0.71% to 3,040.18 and Jakarta Composite plunged 0.69 points or 0.01% to 7,003.65. However, Nikkei 225 surged 189.28 points or 0.57% to 33,641.11.