Sensex, Nifty fall sharply during early noon deals

A heavy selling at Realty and Utilities counters pushed Indian markets in deep red during early afternoon deals, with both Sensex and Nifty trading sharply lower, amid weak cues from other Asian markets. Traders were cautious amid a private report stating that while it seems increasingly unlikely the US economy is headed for recession, small businesses still face headwinds like higher costs and difficulty retaining qualified workers. Investors awaited key U.S. inflation data this week that could influence the timing of the Federal Reserve's easing cycle. On the sectoral front, steel stocks were in watch, amid reports that India's steel imports touched a six-year high in the first 10 months of the fiscal year to March, led by Chinese shipments, and India was a net importer of finished steel. 

On the global front, Asian markets were trading mostly in red, even after Japan's leading index increased more than initially estimated in December. The final data from the Cabinet Office revealed that the leading index, which measures future economic activity, advanced to 110.2 from 108.1 in November. In the flash report, the score was 110.0. 

The BSE Sensex is currently trading at 72654.01, down by 441.21 points or 0.60% after trading in a range of 72487.50 and 73223.11. There were 4 stocks advancing against 26 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 1.17%, while Small cap index was down by 1.40%.

The only gaining sectoral indices on the BSE were TECK up by 0.09% and IT up by 0.06%, while Realty down by 1.87%, Utilities down by 1.86%, Telecom down by 1.65%, Oil & Gas down by 1.63% and Power down by 1.55% were the top losing indices on BSE.

The top gainers on the Sensex were TCS up by 0.77%, Infosys up by 0.58%, Hindustan Unilever up by 0.34% and Bharti Airtel up by 0.08%. On the flip side, Power Grid down by 2.46%, Maruti Suzuki down by 2.30%, Asian Paints down by 2.05%, Mahindra & Mahindra down by 1.68% and Wipro down by 1.67% were the top losers.

Meanwhile, rating agency ICRA in its latest report has said that the borrowing cost for states continued to fall for the third week in a row, with the weighted average price falling to 7.44 per cent in the debt auction on February 27, 2024. The cost had remained at a two-year high throughout January sniffing at 7.8 per cent.

However, the report said the overall cost has been falling since the interim Union Budget, which forecast a lower than anticipated borrowing and a fiscal deficit target of 5.8 per cent for this fiscal and 5.1 per cent for the next financial year. The weighted average cut-off rate eased by 2 basis points to 7.44 per cent on February 27, 2024, with issuance trailing the indicated amount for the fifth consecutive week.

According to the report, twelve states raised Rs 32,800 crore through State Government Securities (SGS) on February 27 and the amount is 27 per cent lower than the highest-ever weekly auction of Rs 45,200 crore indicated for this week in the fourth quarter auction calendar. Both limited supply and the falling overall interest rates pulled down the weighted average cut-off to 7.44 per cent on February 27, 2024 from 7.46 per cent last week despite a mild increase in the weighted average tenor to 14 years from 13 years.  

The CNX Nifty is currently trading at 22053.60, down by 144.75 points or 0.65% after trading in a range of 22001.30 and 22229.15. There were 7 stocks advancing against 43 stocks declining on the index.

The top gainers on Nifty were HDFC Life Insurance up by 0.87%, TCS up by 0.86%, SBI Life Insurance up by 0.71%, Infosys up by 0.69% and Hindustan Unilever up by 0.36%. On the flip side, Apollo Hospital Ent. down by 3.33%, Bajaj Auto down by 3.05%, Power Grid down by 2.36%, Eicher Motors down by 2.21% and Maruti Suzuki down by 2.20% were the top losers.

Asian markets were trading mostly in red; Hang Seng declined 234.86 points or 1.4% to 16,555.94, Straits Times fell 15.22 points or 0.48% to 3,142.10, Shanghai Composite weakened 35.63 points or 1.18% to 2,979.85 and Nikkei 225 slipped 31.49 points or 0.08% to 39,208.03, while Jakarta Composite gained 24.34 points or 0.33% to 7,309.66 and KOSPI increased 27.24 points or 1.03% to 2,652.29.