Markets trade flat with positive bias in early noon session

Domestic equity markets traded flat with positive bias in early noon session as investors opted to buy beaten down but fundamentally strong stocks. Meanwhile, broader indices outperformed their large peers with BSE Mid cap index and BSE Small cap index gaining in the range of 0.80-1.05%. Traders were getting some encouragement as provisional payroll data of EPFO showed that formal job creation under the Employees' Provident Fund Organisation (EPFO) increased 18.2% year-on-year in October with the addition of 1.53 million net new subscribers. However, weak cues from global markets weighted on the domestic sentiment. On the sectoral front, most of the sectoral indices on BSE were holding in green, with only exception of Bankex counter. Stocks from Energy, Telecom, Utilities, Power and Oil & Gas from counters were the prominent gainers. 

On the global front, Asian markets were trading mostly in red, following negative cues from the US markets overnight as investors awaited gross domestic product reading and inflation numbers from the U.S. Back home, in the stock specific development, Suzlon Energy rose after the company bagged a repeat order for the development of a 193.2 MW wind power project from The KP Group.

 The BSE Sensex is currently trading at 70513.28, up by 6.97 points or 0.01% after trading in a range of 69920.39 and 70614.49. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.80%, while Small cap index up by 1.05%.

The top gaining sectoral indices on the BSE were Energy up by 1.00%, Telecom up by 0.98%, Utilities up by 0.96%, Power up by 0.96% and Oil & Gas up by 0.95%, while Bankex down by 0.36% was the only losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 1.58%, HDFC Bank up by 1.14%, Reliance Industries up by 0.86%, Tata Motors up by 0.80% and Wipro up by 0.52%. On the flip side, Axis Bank down by 2.46%, Larsen & Toubro down by 1.21%, Indusind Bank down by 1.00%, ICICI Bank down by 0.94% and Mahindra & Mahindra down by 0.84% were the top losers.

Meanwhile, credit rating agency ICRA in its latest report has said that the operating profit margin (OPM) of North India (NI)-based bulk tea players is expected to be significantly impacted in FY2024 due to the double whammy of increase in cost of production, following the wage rate hikes in West Bengal and Assam and the drop in realisation due to the low export demand and a sluggish rural consumption. Thus, the rating agency has revised the sector outlook to Negative from Stable. 

According to the report, the all-India auction prices of orthodox (ODX) tea in 10M CY23 witnessed a significant decline of Rs 51/ kg (21%) on a YoY basis. The same was primarily driven by a sharp drop in the North India ODX tea prices by Rs 70/ kg during 10M CY23 on a YoY basis. The price fall witnessed in South India (SI) ODX tea was, however, limited to Rs 7/ kg (5%) during the same period. The slump in ODX tea realisation was due to lower export demand, primarily from Iran.

Similarly, the report said the all-India cumulative auction average of crush-tear-curl (CTC) tea also witnessed a decline during 10M CY23, but to a lower extent of Rs. 6/ kg (3%). This was entirely due to the decline in NI CTC price by Rs. 10/ kg (5%) as the SI CTC price registered an increase of Rs. 6/ kg during 10M CY23 on a YoY basis. Sluggish rural demand, along with headwinds in export markets due to oversupply of Kenyan teas, India’s main competitor as far as CTC teas are concerned, have contributed to the decline. 

The CNX Nifty is currently trading at 21164.50, up by 14.35 points or 0.07% after trading in a range of 20976.80 and 21180.10. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Britannia up by 2.93%, Apollo Hospital up by 2.61%, Power Grid up by 1.61%, Eicher Motors up by 1.09% and HDFC Bank up by 1.09%. On the flip side, Axis Bank down by 2.48%, Bajaj Auto down by 1.21%, SBI Life down by 1.18%, Larsen & Toubro down by 1.14% and Indusind Bank down by 1.05% were the top losers.

Asian markets are trading mostly in red; Hang Seng declined 12.62 points or 0.08% to 16,601.19, Nikkei 225 slipped 535.47 points or 1.62% to 33,140.47, Taiwan Weighted lost 91.46 points or 0.52% to 17,543.74, Jakarta Composite plunged 20.21 points or 0.28% to 7,199.46.  However, Straits Times rose 6.36 points or 0.2% to 3,114.39, KOSPI dropped 18.07 points or 0.69% to 2,596.23 and Shanghai Composite strengthened 16.47 points or 0.57% to 2,918.58.