Key indices extend losses for 2nd consecutive session

Indian equity benchmarks extended their losses for the second consecutive session on Thursday, as investors waited for the Reserve Bank of India’s rate decision on Friday. Besides, risk aversion in global markets amid ongoing uncertainty over US trade tariffs further weighed on the sentiments. 

Some of the important factors in today’s trade:

All eyes on RBI meeting amid rate cut expectations: Investors remained on sidelines ahead of the Reserve Bank of India’s (RBI) monetary policy Committee’s (MPC) decision which is going to be announced on February 7. The RBI began deliberations on its monetary policy on Wednesday, with market expectations pointing to a 25-basis point rate cut--the first in five years. 

FIIs selling resumed: Traders were anxious as exchange data showed that foreign institutional investors (FIIs) offloaded equities worth Rs 1,682.83 crore in the capital markets on a net basis on Wednesday. 

Rupee plunged to fresh record low: Indian rupee depreciated further to hit a new record low of 87.57 (provisional) against the US dollar on Thursday, amid weak domestic markets and importer demand for dollars.  

SBI Q3 profit surged 84%: The country's largest lender State Bank of India (SBI) reported an 84 per cent jump in standalone net profit to Rs 16,891 crore in the December quarter, driven by strong growth in interest income and improvement in asset quality.  

Positive global cues: European markets were trading higher as trade war fears eased and data showed Germany's factory orders rebounded at a much stronger than expected pace in December, largely driven by the manufacture of transport equipment. Asian markets settled mostly higher as trade war fears eased and Treasury yields dipped on easing inflation concerns.

Finally, the BSE Sensex fell 213.12 points or 0.27% to 78,058.16, and the CNX Nifty was down by 92.95 points or 0.39% to 23,603.35.      

The BSE Sensex touched high and low of 78,551.66 and 77,843.99 respectively. There were 10 stocks advancing against 20 stocks declining on the index.

The BSE Mid cap index fell 0.87%, while Small cap index remained flat. 

The top gaining sectoral indices on the BSE were IT up by 0.35%, Healthcare up by 0.17% and Bankex up by 0.02%, while Realty down by 2.15%, Consumer Durables down by 2.04%, Telecom down by 1.73%, Consumer discretionary down by 1.34% and PSU down by 1.31% were the top losing indices on BSE.

The top gainers on the Sensex were Adani Ports &SEZ up by 1.72%, Infosys up by 0.94%, Axis Bank up by 0.71%, HCL Technologies up by 0.60% and Tech Mahindra up by 0.58%. On the flip side, Bharti Airtel down by 2.47%, Titan Company down by 2.28%, NTPC down by 2.13%, SBI down by 1.79% and ITC down by 1.53% were the top losers.

Meanwhile, the Insolvency and Bankruptcy Board of India (IBBI) has amended regulations on liquidation process to ensure better fund management, simplify the auction procedure, and improving reporting requirements. These measures will improve transparency, efficiency, and accountability in the insolvency framework. According to IBBI release, the amendments, notified on January 28, 2025, with immediate effect, modify the Insolvency and Bankruptcy Board of India (Liquidation Process) regulations, 2016, and the Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) rules, 2017.

Under the revised framework, the prospective bidders in the liquidation auction will now have more time -- 30 days to participate in the auction process than 14 days earlier, facilitating wider participation. Further, the liquidator is mandated to verify the eligibility of the highest bidder within three days of the auction and consult with the Stakeholder Consultation Committee (SCC) before finalising the auction. If the highest bidder is found ineligible, the next highest eligible bidder may be considered. Additionally, the auction notice must specify that the Earnest Money Deposit (EMD) of the successful bidder will be forfeited if found ineligible.

Maintaining the Corporate Liquidation Account and Corporate Voluntary Liquidation Account with scheduled banks for more efficient claim processing, the board has strengthened fund management mechanisms. With the revised framework the voluntary liquidation processes can be completed even though the uncalled capital exists, as existing safeguards are considered sufficient to protect creditors.

The board said ‘Regulations now require detailed disclosure of tax deductions by the liquidator before depositing unclaimed dividends and undistributed proceeds into the corporate liquidation account or corporate voluntary liquidation account’. Additionally, Forms have been updated to include fields for applicable provisions, tax deduction confirmation, reasons for unclaimed dividends or undistributed proceeds. The amendments also introduce a late fee of Rs 500 per form per month for delayed filings on the IBBI portal, ensuring timely compliance by insolvency professionals.

The CNX Nifty traded in a range of 23,773.55 and 23,556.25. There were 21 stocks advancing against 30 stocks declining on the index. 

The top gainers on Nifty were Cipla up by 2.51%, Adani Ports & SEZ up by 1.90%, ITC Hotels up by 1.77%, Dr. Reddy's Lab up by 1.01% and HDFC Life Insurance Company up by 0.98%. On the flip side, Trent down by 8.38%, Bharat Electronics down by 3.08%, Bharti Airtel down by 2.32%, Titan Company down by 2.23% and ONGC down by 1.99% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 108.81 points or 1.26% to 8,732.10, France’s CAC rose 66.04 points or 0.84% to 7,957.72 and Germany’s DAX gained 214.21 points or 0.99% to 21,800.14.

Asian markets settled mostly higher on Thursday tracking Wall Street gains overnight and US Treasury yields dipped on easing inflation concerns, while a larger-than-expected drop in US job openings for December renewed expectations for a favourable outlook on interest rates. Moreover, forecasts of high capital spending on artificial intelligence from Wall Street's biggest firms has also supported Asian market sentiments. Chinese ad Hong Kong shares gained on eased concerns over a potential global trade war after USPS has resumed accepting parcels from mainland China and Hong Kong following a brief suspension after US President Donald Trump changed the rules on import taxes. Japanese shares rose, even as the yen firmed on the back of bolstered expectations that the BoJ will continue to raise interest rates.