Markets erase all gains in late morning deals

Domestic equity markets erased all gains and were trading in red during late morning deals on account of profit booking after recent gains. Selling in Infosys, Tata Motors, Tech Mahindra and Power Grid companies’ stocks dragged the markets lower. Traders were cautious as Minneapolis Fed President Neel Kashkari said the U.S. central bank is not done yet with inflation although he noted it had come down quickly with three-month and six-month inflation data basically at the Fed's 2 per cent goal.  Traders ignored Finance Minister Nirmala Sitharaman’s statement that the inflation has come down within the tolerance band as a result of the steps taken by the government to check price rise, especially in perishable commodities. 

On the global front, Asian markets were trading mostly in green amid China’s efforts to bolster its market. Back home, on the BSE sectoral front, traders were seen pilling up position in Realty, Utilities, Power, Bankex and Consumer Durables, while selling was witnessed in IT, TECK, Auto, Oil & Gas and Energy. In the stock specific development, Paytm soared after a private report said that Paytm's CEO Vijay Shekhar Sharma has met with Union Finance Minister Nirmala Sitharaman to discuss the crisis the company is facing.

The BSE Sensex is currently trading at 72117.76, down by 68.33 points or 0.09% after trading in a range of 72116.77 and 72559.21. 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 0.20%, while Small cap index up by 0.48%.

The top gaining sectoral indices on the BSE were Realty up by 2.14%, Utilities up by 1.12%, Power up by 1.04%, Bankex up by 0.48% and Consumer Durables up by 0.46%, while IT down by 0.85%, TECK down by 0.68%, Auto down by 0.52%, Oil & Gas down by 0.25% and Energy down by 0.07% were the top losing indices on BSE.

The top gainers on the Sensex were SBI up by 2.55%, Axis Bank up by 1.65%, Sun Pharma up by 1.38%, Ultratech Cement up by 1.15% and JSW Steel up by 1.09%. On the flip side, Infosys down by 1.69%, Power Grid down by 1.39%, Tata Motors down by 0.94%, NTPC down by 0.84% and Tech Mahindra down by 0.83% were the top losers.

Meanwhile, Finance Minister Nirmala Sitharaman has said that the inflation has come down within the tolerance band as a result of the steps taken by the government to check price rise, especially in perishable commodities.  She said the government is seized of the difficulties, which arise due to shortage of perishable goods, which are not grown in India. She added that the committee sits and reviews periodically, and the efforts have shown on the ground that inflation is now within the tolerable band.

The minister said that in order to check the volatility in prices of onion, the government has progressively increased its buffer size from 1 lakh metric tonnes (LMT) in 2020-21 to 7 LMT in 2023-24. As of February 3, 2024, a total of 6.32 LMT of onion was procured, and 3.96 LMT of Grade-A onion was released through retail sales, e-Nam auction and bulk sales. Currently, steps are being taken so that the preservation of very highly perishable commodities, like onion, can be improved and added that lots of steps have been taken by the government, particularly for meeting the shortage in supply of perishable goods.

India's retail inflation has declined from an average of 6.8 per cent in April-December 2022 to 5.5 per cent in the corresponding period of 2023. The retail inflation is now stable and within the notified tolerance band of 2 per cent to 6 per cent.

The CNX Nifty is currently trading at 21887.95, down by 41.45 points or 0.19% after trading in a range of 21884.95 and 22053.30. There were 22 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were SBI up by 2.83%, HDFC Life Insurance up by 2.61%, Britannia up by 2.12%, Axis Bank up by 1.70% and Grasim Industries up by 1.54%. On the flip side, Infosys down by 1.70%, Power Grid down by 1.42%, Tata Motors down by 0.92%, Hero MotoCorp down by 0.88% and ONGC down by 0.86% were the top losers.

Asian markets were trading mostly in green; Straits Times rose 28.3 points or 0.91% to 3,153.98, KOSPI increased 30.95 points or 1.2% to 2,607.15, Shanghai Composite strengthened 18.86 points or 0.68% to 2,808.35 and Jakarta Composite gained 6.29 points or 0.09% to 7,253.70. However, Nikkei 225 slipped 65.91 points or 0.18% to 36,094.75 and Hang Seng declined 59.63 points or 0.37% to 16,077.24.