Benchmarks slip into red in morning deals

In a highly volatile trade, Indian equity benchmarks erased initial gains and slipped into red terrain in the morning session, amid mixed global market cues. Traders remained cautious ahead of the F&O monthly expiry and Q3 GDP numbers for direction. Some concern also came with a report by SBI Research stating that the Indian economy is likely to grow at 6.7-6.9 per cent in December quarter FY24 as compared to 7.6 per cent growth in the second quarter on poor performance in the farm sector. Adding to the pessimism, provisional data from the NSE showed foreign institutional investors (FIIs) net sold shares worth Rs 1,879.23 crore on February 28, 2024. On the global front, Asian markets are trading mixed as traders remain cautious ahead the release of inflation data from the US, Japan and Europe which could provide more clarity on the outlook for global interest rate moves.

The BSE Sensex is currently trading at 72180.77, down by 124.11 points or 0.17% after trading in a range of 72099.32 and 72613.32. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.45%, while Small cap index was down by 0.72%.

The lone gaining sectoral index on the BSE was Consumer Durables up by 0.17%, while Healthcare down by 1.38%, Realty down by 1.13%, Utilities down by 0.93%, Industrials down by 0.87% and Power down by 0.80% were the top losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 1.30%, Mahindra & Mahindra up by 1.00%, Maruti Suzuki up by 0.87%, Titan Company up by 0.57% and Nestle up by 0.56%. On the flip side, Axis Bank down by 1.71%, Power Grid Corporation down by 1.54%, Sun Pharma down by 0.82%, Larsen & Toubro down by 0.80% and Tech Mahindra down by 0.78% were the top losers.

Meanwhile, SBI Research in a report said that the Indian economy is likely to grow at 6.7-6.9 per cent in December quarter (Q3) FY24 as compared to 7.6 per cent growth in the second quarter on poor performance in the farm sector. It has projected Q4 GDP at 6.8 per cent. The report comes a day ahead of the release of official GDP data for the third quarter of 2023-24 financial year. India retained the tag of the world's fastest-growing major economy, with its GDP expanding by a faster-than-expected rate of 7.6 per cent in September quarter on booster shots from government spending and manufacturing.

The report said the biggest reason for the lower growth forecast is the very poor show by the farm sector as, barring fisheries, the whole sector is badly affected. As per the first advance estimates, the production of major kharif crops in 2023-24 is pegged at 148.5 million tonne, which is 4.6 per cent lower than that in the year-ago period. While the sowing season for rabi crops indicates a slight increase in overall acreage compared to the previous year, there are concerns over the sown area under cereals, which saw a decline of 6.5 per cent from the previous year. While agriculture may see some moderation if the rabi output does not offset the kharif shortfall, value added in agriculture will decline.

On the other hand, corporate results as recorded from around 4,000 listed entities for Q3FY24, show robust growth of over 30 per cent in PAT, while topline grew by around 7 per cent compared to Q3FY23. Further, listed entities reported improvement in margins as reflected in results of around 3,000 companies ex-BFSI (banking, financial services and insurance), with margins of 14.95 per cent in Q3 compared to around 12 per cent in the same period previous year. Corporate Gross Value Added (GVA), as measured by operating profit plus employee expenses grew around 26 per cent in Q3 on-year.

The CNX Nifty is currently trading at 21902.40, down by 48.75 points or 0.22% after trading in a range of 21860.65 and 22022.40. There were 16 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were Reliance Industries up by 1.20%, Mahindra & Mahindra up by 0.95%, Maruti Suzuki up by 0.81%, Tata Consumer Product up by 0.71% and Nestle up by 0.47%. On the flip side, Bajaj Auto down by 2.15%, Apollo Hospital down by 1.91%, Cipla down by 1.60%, Axis Bank down by 1.60% and Power Grid Corporation down by 1.54% were the top losers.

Asian markets are trading mixed; Taiwan Weighted added 66.21 points or 0.35% to 18,920.62, Hang Seng advanced 24.68 points or 0.15% to 16,561.53, Jakarta Composite gained 4.36 points or 0.06% to 7,333.00 and Shanghai Composite strengthened 21.71 points or 0.73% to 2,979.56.

On the flip side, Nikkei 225 slipped 22.39 points or 0.06% to 39,185.64, Straits Times fell 0.92 points or 0.03% to 3,138.01 and KOSPI dropped 6.37 points or 0.24% to 2,645.92.