Volatility continues to hit Indian markets

A volatility continued to hit Indian equity benchmarks in early afternoon deals, with both Sensex and Nifty altering between green and red, amid selling at IT and TECK counters, despite positive cues from other Asian markets. Investors await the second-quarter GDP data, due on Thursday and the S&P Global Manufacturing PMI later on Friday. The street paid no heed towards reports that the commerce ministry is working to address issues related to non-tariff barriers and market access for domestic products in sub-Saharan African countries like Nigeria, Ethiopia, Ghana and Gulf nations to boost India's exports. The official said meetings have been held with Indian missions of the sub-Saharan African countries with which India has significant bilateral trade.

On the global front, Asian markets were trading mostly in green, even as South Korea's consumer sentiment weakened in November to the lowest level in seven months as households' current living conditions worsened. The survey results from the Bank of Korea showed that the consumer confidence index fell to 97.2 in November from 98.1 in October. This was the lowest reading since April 2022, when it was 95.1. The consumer confidence survey was conducted between November 10 and 17 among 2,500 households.

The BSE Sensex is currently trading at 65984.06, up by 14.02 points or 0.02% after trading in a range of 65911.01 and 66098.80. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.08%, while Small cap index was up by 0.13%.

The top gaining sectoral indices on the BSE were Utilities up by 3.56%, Power up by 3.18%, Oil & Gas up by 2.50%, Energy up by 1.48% and Basic Materials up by 1.14%, while IT down by 0.48%, TECK down by 0.37%, Capital Goods down by 0.32%, Industrials down by 0.18% and Telecom down by 0.17% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 2.94%, Ultratech Cement up by 1.99%, Bajaj Finserv up by 1.56%, Titan up by 1.33% and Bajaj Finance up by 1.09%. On the flip side, Nestle down by 0.68%, ICICI Bank down by 0.65%, Reliance Industries down by 0.65%, Tech Mahindra down by 0.64% and HCL Tech. down by 0.57% were the top losers.

Meanwhile, the Global Trade Research Initiative (GTRI) has said that reducing import duties on inputs and capital goods could help the government cut down the need for many of the existing export schemes. This would be an important step as India continues to face challenges in managing these incentives within the framework of international trade laws. Many countries, including major trade partners of India like the European Union (EU) and the US continue to declare Indian schemes as subsidies and punish exporters by charging countervailing duties. America and the EU account for over 20 per cent of the country's total outbound shipments.

GTRI has noted that at present, India is implementing many schemes to facilitate exports. These include the Advance Authorisation Scheme (AAS), Export Promotion Capital Goods Scheme (EPCGS), Duty Drawback Scheme (DDS), the Remission of Duties and Taxes on Exported Products (RoDTEP), Special Economic Zones (SEZ), Export Oriented Units (EOUs); Pre-shipment and Post-shipment credits banks, and Interest Equalization scheme (IES). These schemes aim to enhance Indian products' competitiveness in the global market.

It further said currently, India's average tariff or customs duties for industrial products is 14.7 per cent, compared to the EU's 4.1 per cent. Many of India's export schemes, like SEZ, EOU, RoDTEP, and Drawback, exist because of such high import duties. Exporters use these schemes to either get a refund of duties paid or to be exempt from paying import duties. Reducing import duties on inputs and capital goods could lessen the need for many of these export schemes. It also suggested that to comply with global trade rules, India can make several improvements in export schemes, like in the AAS a robust system needs to be put in place to trace raw materials and ensure their actual use in production.

The CNX Nifty is currently trading at 19835.30, up by 40.60 points or 0.21% after trading in a range of 19800.00 and 19848.05. There were 29 stocks advancing against 20 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Adani Enterprises up by 10.81%, Adani Ports & SEZ up by 6.59%, Tata Motors up by 2.88%, BPCL up by 2.81% and Hero MotoCorp up by 2.03%. On the flip side, Eicher Motors down by 1.24%, LTIMindtree down by 0.85%, Apollo Hospital down by 0.80%, ICICI Bank down by 0.76% and Nestle down by 0.72% were the top losers.

Asian markets were trading mostly in green; Taiwan Weighted added 203.83 points or 1.18% to 17,341.25, Jakarta Composite gained 45.56 points or 0.65% to 7,058.97, Shanghai Composite strengthened 6.85 points or 0.23% to 3,038.55 and KOSPI increased 26.10 points or 1.03% to 2,521.76, while Hang Seng declined 145.6 points or 0.83% to 17,379.46, Straits Times fell 17.39 points or 0.56% to 3,069.03 and Nikkei 225 slipped 39.28 points or 0.12% to 33,408.39.