Benchmarks trade choppy amid escalating geopolitical tensions between India-Pakistan

Indian equity markets traded choppy with negative bias after hovering near the unchanged lines. The stocks lack direction as the traders remained cautious amidst escalating geopolitical tensions between India and Pakistan after India neutralize Pakistan’s air defence systems in Lahore. Besides, sentiments waned after S&P Global Ratings indicated that the hostilities between India and Pakistan heighten risks to the credit metrics of both countries, and any escalation in clashes would put downward pressure on sovereign credit support.

On the global front, Asian equity markets are trading mixed as traders reacted to the Federal Reserve's status-quo rate decision and awaited cues from upcoming trade negotiations between China and the United States. European markets were trading higher ahead of US-UK trade deal announcement.

The BSE Sensex is currently trading at 80675.77, down by 71.01 points or 0.09% after trading in a range of 80539.57 and 80927.99. There were 14 stocks advancing against 16 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index plunged 0.85%, while Small cap index was up by 0.11%.

The top gaining sectoral indices on the BSE were IT up by 0.43%, Bankex up by 0.26%, Industrials up by 0.13%, Capital Goods up by 0.10% and TECK up by 0.01%, while Auto down by 1.52%, Realty down by 1.37%, Metal down by 1.09%, Oil & Gas down by 1.03% and Basic Materials down by 0.99% were the losing indices on BSE.

The top gainers on the Sensex were HCL Technologies up by 1.56%, Axis Bank up by 1.28%, Titan Company up by 1.16%, Tata Motors up by 0.79% and Kotak Mahindra Bank up by 0.75%. On the flip side, Mahindra & Mahindra down by 2.46%, Eternal down by 2.45%, Maruti Suzuki down by 2.09%, Tata Steel down by 1.74% and Bharti Airtel down by 1.21% were the top losers.

Meanwhile, the Cabinet Committee on Economic Affairs (CCEA) has accorded its approval for the Revised SHAKTI (Scheme for Harnessing and Allocating Koyala Transparently in India) Policy for Coal Allocation to Power Sector. The Revised SHAKTI Policy adds to the series of coal sector reforms being undertaken by the Government. This Revised SHAKTI Policy would maximize domestic coal utilization, ensure seamless thermal capacity addition, reduce dependence for coal on global markets, and reinforce nation’s energy independence aligning with Government’s push for Energy Security for All.

With the introduction of SHAKTI Policy in 2017, there was a paradigm shift of coal allocation mechanism from a nomination-based regime to a more transparent way of allocation of coal linkages through auction / tariff-based bidding. Now, the multiple paras of the SHAKTI Policy, for coal linkage, have been mapped to only two Windows in the Revised SHAKTI Policy, aligning with the spirit of ease of doing business, encouraging competition, efficiency, better use of capacity, seamless pit head thermal capacity addition and affordable power to the country.

The new policy will ensure coal linkage to all power producers leading to generation of more power, cheaper tariffs and an overall positive impact on the economy, thereby leading to increased employment generation potential. The reliable and affordable power supply to various sectors would catalyze economic activities and support the Atmanirbhar Bharat Initiative. The increased availability of domestic coal, in a simplified manner would also facilitate the revival of remaining stressed power assets. The linkage coal can now be used for generating power from Un-requisitioned Surplus (URS) capacity, for sale in power markets, which will not only deepen power markets by increasing availability of power in power exchanges but will also ensure optimum utilization of generating stations.

The CNX Nifty is currently trading at 24340.55, down by 73.85 points or 0.30% after trading in a range of 24313.50 and 24447.25. There were 13 stocks advancing against 37 stocks declining on the index.

The top gainers on Nifty were HCL Technologies up by 1.39%, Axis Bank up by 1.34%, Titan Company up by 1.20%, Kotak Mahindra Bank up by 0.84% and Tata Motors up by 0.82%. On the flip side, Tata Consumer Products down by 2.75%, Mahindra & Mahindra down by 2.51%, Eternal down by 2.46%, Eicher Motors down by 2.17% and Maruti Suzuki down by 2.07% were the top losers.

Asian markets are trading mixed; Hang Seng advanced 84.04 points or 0.37% to 22,775.92, KOSPI increased 5.68 points or 0.22% to 2,579.48, Nikkei 225 surged 148.97 points or 0.4% to 36,928.63 and Shanghai Composite strengthened 9.33 points or 0.28% to 3,352.00, while Jakarta Composite plunged 95.55 points or 1.38% to 6,830.68, Straits Times fell 23.01 points or 0.6% to 3,842.36 and Taiwan Weighted lost 3.09 points or 0.02% to 20,543.40.

European markets were trading higher; UK’s FTSE 100 increased 21.93 points or 0.26% to 8,581.26, France’s CAC rose 66.27 points or 0.87% to 7,693.11 and Germany’s DAX gained 229.86 points or 0.99% to 23,345.82.