Markets trade flat in early deals amid Middle East conflict

Indian equity benchmarks made flat-to-negative start on Thursday following the mixed cues from Wall Street overnight as well as broadly negative cues from Asian counterparts amid escalating trend in the ongoing conflict between Israel and Iran as they continued to attack each other for the seventh consecutive day, with speculation of the U.S. joining Israel in striking Iranian nuclear sites. Sensex and Nifty are struggling for direction and are trading flat with positive bias in early deals ahead of weekly F&O expiry later in the day. Some support came as Commerce and Industry Minister Piyush Goyal said that the India-UK Free Trade Agreement (FTA) brings stability and predictability for businesses in both the countries. In stock specific development, ESAF Small Finance Bank jumped after its board approved the sale of non-performing and technically written-off loans worth Rs 735.18 crore to an asset reconstruction company.

The BSE Sensex is currently trading at 81472.68, up by 28.02 points or 0.03% after trading in a range of 81191.04 and 81583.94. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.02%, while Small cap index was up by 0.25%.

The top gaining sectoral indices on the BSE were Capital Goods up by 0.83%, Industrials up by 0.60%, Power up by 0.57%, Auto up by 0.57% and Consumer Discretionary up by 0.35%, while IT down by 0.60%, Metal down by 0.47%, TECK down by 0.33%, Oil & Gas down by 0.26% and PSU down by 0.18% were the top losing indices on BSE.

The top gainers on the Sensex were Titan Company up by 0.91%, Bharat Electronics up by 0.71%, Mahindra & Mahindra up by 0.68%, Tata Motors up by 0.67% and Kotak Mahindra Bank up by 0.53%. On the flip side, Tech Mahindra down by 1.78%, Adani Ports & SEZ down by 1.52%, Infosys down by 0.72%, Power Grid down by 0.59% and TCS down by 0.48% were the top losers.

Meanwhile, expressing an optimism over India-UK trade pact, Commerce and Industry Minister Piyush Goyal has said that the India-UK Free Trade Agreement (FTA) brings ‘stability and predictability’ for businesses in both the countries. He added that this will lead to doubling the bilateral trade in five years. He said ‘That gives confidence to business to start investing in each other’s economy and I think this will also pave the way for greater investments in the two economies, add to our trade in goods and services… India and UK can partner in innovation to work together to bring more resilient supply chains, working with each other, complementing each other and adding value and profits to both countries’.

Goyal arrived in London on a two-day visit to discuss with his UK counterpart Jonathan Reynolds the next steps towards implementation of the Free Trade Agreement (FTA), and explore ways to boost trade and investment between the two countries. In their first joint public intervention since the FTA negotiations concluded last month, UK counterpart Jonathan Reynolds had said he was ‘genuinely excited’ about the prospects opened up with the FTA. He had said that the trade deal is estimated to increase bilateral trade in the long run by GBP 25.5 billion every year – from the current annual estimate of GBP 41 billion – as tariffs are slashed across key sectors on both sides. He noted ‘This trade agreement is a huge economic win for the UK - the biggest trade deal since Brexit and the best deal that India has ever offered’.

The Ministry of Commerce and Industry highlighted significant positive gains for employment in the country, offering a substantial improvement in competitiveness of Indian goods in the UK vis-a-vis other countries as well as easing mobility for professionals. The FTA, announced on May 6 with a target to double trade between the two economies to $120 billion by 2030, is now undergoing a process of legal text formalisation before it can come into force. The commerce ministry said ‘Both leaders will review the progress made in the ongoing FTA negotiations and chart out a clear, time-bound roadmap for its finalisation and implementation’.

The CNX Nifty is currently trading at 24825.45, up by 13.40 points or 0.05% after trading in a range of 24738.10 and 24863.10. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Eicher Motors up by 1.12%, Titan Company up by 1.05%, Tata Consumer Products up by 1.03%, Apollo Hospital up by 1.02% and Grasim Industries up by 0.95%. On the flip side, Tech Mahindra down by 1.96%, Adani Ports & SEZ down by 1.65%, Infosys down by 0.77%, Indusind Bank down by 0.65% and Tata Steel down by 0.64% were the top losers.

All Asian markets are trading lower; Hang Seng declined 474.44 points or 2% to 23,236.25, Taiwan Weighted lost 303.29 points or 1.36% to 22,053.44, Nikkei 225 slipped 280.09 points or 0.72% to 38,605.06, Jakarta Composite plunged 110.59 points or 1.56% to 6,997.20, Shanghai Composite weakened 29.03 points or 0.86% to 3,359.78, Straits Times fell 11.42 points or 0.29% to 3,909.39 and KOSPI was down by 3.81 points or 0.13% to 2,968.38.