Profit booking keeps Indian markets down in early noon deals

A profit booking in IT and TECK stocks kept Indian equity benchmarks down during early afternoon deals, with both Sensex and Nifty trading lower, despite positive cues from other Asian markets. Investors turned cautious, as India's aggressive fiscal consolidation objective for next year is already being doubted, with Fitch Ratings saying it expects the target of 5.1 percent of GDP to be missed by as much as 30 basis points. Adding more concerns among traders, a private report stated that businesses' one-year-ahead inflation expectations rose sharply to 4.58 percent in December 2023 from 4.04 percent in October 2023.

On the global front, Asian markets were trading mostly in green, after Japan's leading index rose more than expected to a 14-month high in December. The preliminary data from the Cabinet Office revealed that the leading index, which measures future economic activity, advanced to 110.0 from 108.1 in November. This was the highest reading since October 2022. The score was expected to rise moderately to 109.4.

Back home, the renewable energy industry stocks were in watch, as the Ministry of New and Renewable Energy is working on the modalities for promoting the use of green hydrogen in supporting round-the-clock electricity, in furtherance of the Government’s thrust towards promoting increased adoption of renewable energy and use of green hydrogen as envisaged in the National Green Hydrogen Mission.

The BSE Sensex is currently trading at 72033.73, down by 152.36 points or 0.21% after trading in a range of 71938.22 and 72559.21. There were 14 stocks advancing against 16 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose by 0.19%, while Small cap index was up by 0.42%.

The top gaining sectoral indices on the BSE were Realty up by 2.01%, Power up by 0.99%, Utilities up by 0.98%, Metal up by 0.70% and Basic Materials up by 0.51%, while IT down by 0.96%, TECK down by 0.81%, Auto down by 0.29%, Capital Goods down by 0.14% and Consumer Durables down by 0.08% were the top losing indices on BSE.

The top gainers on the Sensex were SBI up by 3.23%, JSW Steel up by 1.97%, Axis Bank up by 1.29%, Sun Pharma up by 1.07% and Ultratech Cement up by 1.05%. On the flip side, Power Grid down by 2.08%, Infosys down by 1.91%, ICICI Bank down by 1.16%, TCS down by 0.98% and NTPC down by 0.93% were the top losers.

Meanwhile, Moody's Investors Service, in a report on Asia–Pacific (APAC), has said that growth in Asia Pacific will decelerate in 2024 as a downshift in China's growth trajectory will spill over in the region through trade in goods and services, but India will be able to mitigate the challenge aided by robust domestic demand.

According to the report, a downshift in China's economic growth rate and a cyclical slowdown in the US will weigh on Asia-Pacific (APAC)'s credit conditions in 2024. Peaking inflation globally will provide space for monetary tightening cycles to slow, but financial conditions will remain difficult for the weakest-rated issuers. Meanwhile, geopolitical risks will continue to shape business decisions. 

It further said growth will decelerate in 2024, but continue to outperform that of most other regions. The downshift in China's growth trajectory will spill over in the region through a number of transmission channels, such as trade in goods and services, commodity prices and investment. This will be mitigated by robust domestic demand in large emerging markets, such as Indonesia and India. In November 2023, Moody's Investors Service had projected Indian's GDP to grow 6.1 per cent in 2024 and 6.3 per cent in 2025. As per Moody's, the growth in 2023 was 6.7 per cent.

The CNX Nifty is currently trading at 21905.00, down by 24.40 points or 0.11% after trading in a range of 21860.15 and 22053.30. There were 23 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were SBI up by 3.21%, HDFC Life Insurance up by 2.37%, JSW Steel up by 2.25%, Britannia up by 2.14% and Grasim Industries up by 1.58%. On the flip side, Power Grid down by 2.02%, Infosys down by 1.85%, ICICI Bank down by 1.12%, Adani Ports & SEZ down by 0.95% and ONGC down by 0.94% were the top losers.

Asian markets were trading mostly in green; Jakarta Composite gained 9.79 points or 0.13% to 7,257.20, Straits Times rose 26.53 points or 0.84% to 3,152.21, Shanghai Composite strengthened 28.76 points or 1.02% to 2,818.25 and KOSPI increased 33.38 points or 1.28% to 2,609.58, while Hang Seng declined 45.16 points or 0.28% to 16,091.71 and Nikkei 225 slipped 40.74 points or 0.11% to 36,119.92.