Benchmarks continue to show sluggish trend in morning deals

Mirroring weak global cues, Indian equity benchmarks continued to show a sluggish trend in morning session. Traders remained cautious as Reserve Bank’s latest data showed that an unfavourable base effect brought down the overall non-food credit growth of the banks to 13.9 per cent at Rs 163.46 lakh crore as of June 30, 2024 as against 16.3 per cent in June 2023, even as gold and housing loans rose sharply. The growth in credit card outstanding, meanwhile, declined during the 12-month period. Traders took a note of the Global Trade Research Initiative (GTRI) stated that strategic reforms are needed to enhance India's appeal to global investors as despite having huge potential, FDI data shows that the country has not fully capitalised on its opportunities. Sector-wise, the coal industry stocks remained in watch as the government said India's coal output rose by 6.69 per cent year-on-year to 74.07 million tonnes (MT) in July. The country's coal production was 69.42 MT in the corresponding month of previous fiscal. On the global front, Asian markets are trading lower following the broadly negative cues from global markets overnight as a fresh dose of weak economic data from the U.S. and Europe reignited recession fears. 

The BSE Sensex is currently trading at 81131.69, down by 735.86 points or 0.90% after trading in a range of 80995.70 and 81345.60. There were 3 stocks advancing against 27 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.95%, while Small cap index was down by 0.58%.

The lone gaining sectoral index on the BSE was Healthcare up by 0.08%, while Metal down by 2.12%, Auto down by 1.95%, Realty down by 1.80%, PSU down by 1.53% and Capital Goods down by 1.47% were the top losing indices on BSE.

The top gainers on the Sensex were HDFC Bank up by 1.14%, Sun Pharma up by 0.61% and Hindustan Unilever up by 0.54%. On the flip side, Tata Motors down by 3.59%, Maruti Suzuki down by 3.09%, JSW Steel down by 2.56%, Tata Steel down by 2.51% and Larsen & Toubro down by 2.06% were the top losers.

Meanwhile, CRISIL Ratings has said that rising domestic tourism and increasing propensity to travel overseas will expand the revenue of India's tour and travel operators by 15-17 per cent this fiscal (FY25). Factors like improving infrastructure, rising disposable incomes, a behavioural shift in travel patterns, and the government's increasing focus on boosting domestic tourism will further support the sector's revenue growth.

It said the assessment was based on an analysis of the country's four major travel operators, who account for about 60 per cent of the sector's revenue. It stated ‘The credit profiles of travel operators, too, are expected to remain healthy, supported by strong balance sheets and steady operating margins of 6.5-7 per cent, in line with last fiscal, resulting in sizeable cash flows and continuing low reliance on debt.’

In the domestic tourism market, growth is being fuelled by 'micro holidays' (e.g., quick getaways or staycations over long weekends), growing spiritual tourism, and better infrastructure (improved last-mile connectivity) facilitating travel to newer destinations.

It stated an increase in inbound travel (foreign tourist arrivals) to pre-pandemic levels and high demand from the corporate and MICE (meetings, incentives, conferences and exhibitions) segments are also supporting domestic travel. For overseas leisure travel, growth is being led by higher disposable incomes, visa-free facilities from 37 countries, simplified visa processes, including visa-on-arrival and e-visa facilities, among others, and easing visa-related challenges related to long-haul destinations.

The CNX Nifty is currently trading at 24754.10, down by 256.80 points or 1.03% after trading in a range of 24723.70 and 24851.90. There were 6 stocks advancing against 44 stocks declining on the index.

The top gainers on Nifty were HDFC Bank up by 1.10%, Apollo Hospital up by 0.64%, Dr. Reddy's Lab up by 0.58%, Divi's Lab up by 0.36% and Hindustan Unilever up by 0.25%. On the flip side, Tata Motors down by 4.16%, Maruti Suzuki down by 3.96%, Eicher Motors down by 3.64%, JSW Steel down by 2.80% and Tata Steel down by 2.46% were the top losers.

All Asian markets are trading lower; Hang Seng declined 354.37 points or 2.09% to 16,950.59, Jakarta Composite plunged 14.58 points or 0.2% to 7,311.41, Shanghai Composite weakened 13.07 points or 0.45% to 2,919.32, Straits Times fell 34.51 points or 1.01% to 3,385.33, KOSPI dropped 95.88 points or 3.45% to 2,681.80, Nikkei 225 slipped 1850.34 points or 4.85% to 36,275.99 and Taiwan Weighted lost 905.33 points or 4% to 21,736.77.