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Domestic indices trade flat in early deals
Nov-08-2024

Indian equity benchmarks made slightly positive start on Friday following broadly positive cues from Wall Street overnight and mixed cues from Asian counterparts after the US Fed delivered the widely expected decision to lower interest rates by a quarter point and signaled no intention to skip cutting rates. The Bank of England also cut interest rates. Fed Chair Jerome Powell stressed during his post-meeting press conference that rates are not on ‘any preset course’ and that the central bank will make future decisions ‘meeting by meeting’ to deal with the risks to both sides of the dual mandate. But soon markets turned volatile and are trading flat in early deals amid persistent foreign fund outflows. The foreign institutional investors (FIIs) sold equities worth Rs 4,888 crore on November 7. 

On the sectoral front, power stocks are in focus as a private report projected robust growth for India’s power sector, anticipating a compound annual growth rate (CAGR) of over 7 per cent in electricity demand from FY24 to FY27. In stock specific development, Lupin fell despite its Q2 net profit nearly doubles to Rs 850 crore.

The BSE Sensex is currently trading at 79750.38, up by 208.59 points or 0.26% after trading in a range of 79117.37 and 79761.20. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index rose 0.11%, while Small cap index was down by 0.31%.

The top gaining sectoral indices on the BSE were IT up by 1.11%, TECK up by 0.96%, Consumer Durables up by 0.84%, Metal up by 0.55% and Telecom up by 0.55%, while Oil & Gas down by 1.00%, Energy down by 0.97%, Utilities down by 0.28%, PSU down by 0.27% and Power down by 0.10% were the top losing indices on BSE.

The top gainers on the Sensex were Infosys up by 1.71%, Tech Mahindra up by 1.39%, Titan Company up by 1.08%, Kotak Mahindra Bank up by 0.66% and HDFC Bank up by 0.58%. On the flip side, Tata Motors down by 1.57%, Maruti Suzuki down by 0.98%, Reliance Industries down by 0.96%, ICICI Bank down by 0.93% and NTPC down by 0.71% were the top losers.

Meanwhile, Niti Aayog CEO BVR Subrahmanyam has said that India should be a part of the Regional Comprehensive Economic Partnership (RCEP) and Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). India pulled out of the RCEP in 2019 after entering negotiations in 2013. The RCEP bloc comprises 10 ASEAN group members (Brunei, Cambodia, Indonesia, Malaysia, Myanmar, Singapore, Thailand, the Philippines, Laos and Vietnam) and their six FTA partners - China, Japan, South Korea, Australia and New Zealand.

Subrahmanyam said ‘India is one of few countries which are not a part of large trade agreements. India should be a part of RCEP (Regional Comprehensive Economic Partnership) and CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) and become a member’. He added ‘...that will be best for India's Micro, Small & Medium Enterprises (MSME) sector. The 40 per cent of India's exports are from MSME. Big corporates are not great exporters’.

CPTPP is a free trade bloc spanning five continents, made up of Pacific rim countries of Canada, Mexico, Peru, Chile, New Zealand, Australia, Brunei, Singapore, Malaysia, Vietnam and Japan. He also said ‘I don't think we have captured the 'China plus one' opportunity as much as we could have’, and added that countries like Vietnam, Indonesia, Malaysia, Turkey, and Mexico have probably benefited more from 'China plus one' than India.

He emphasised that India will have to get into the global value supply chain as 70 per cent of the world's trade happens through the global supply chain. Pointing out that India's tariffs are higher compared to other countries, he said ‘We have 2-3 major bottlenecks, we have tariffs, which are higher. I think if we don't cut tariffs, then we are not going to be benefited because that is the pain point’. He admitted that investment by the private sector is not happening at the pace 'we would like to'.

He further said ‘The private sector is here to make profit.. capacity utilisation (in the private sector) is still running around 70 per cent’. India is one of the shining stars on the global horizon, policy consistency and reforms that have led to a spectacular growth path. He said ‘We ended last fiscal year at about 8.2 per cent growth rate and are poised to be the third largest economy by 2027. Today, our contribution to incremental global growth is about 20 per cent, which will only increase’.

The CNX Nifty is currently trading at 24183.55, down by 15.80 points or 0.07% after trading in a range of 24066.65 and 24223.90. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 1.66%, Infosys up by 1.53%, Wipro up by 1.53%, Tech Mahindra up by 1.44% and Bharat Electronics up by 0.98%. On the flip side, Trent down by 1.86%, BPCL down by 1.62%, Tata Motors down by 1.58%, Coal India down by 1.37% and Shriram Finance down by 1.28% were the top losers.

Asian markets are trading mixed; Taiwan Weighted rose 107.03 points or 0.46% to 23,515.85, Nikkei 225 surged 104.84 points or 0.27% to 39,486.25, Jakarta Composite gained 70.91 points or 0.98% to 7,314.77 and Straits Times was up by 57.45 points or 1.56% to 3,730.94. On the other hand, Hang Seng declined 185.7 points or 0.89% to 20,767.64, Shanghai Composite weakened 17.42 points or 0.5% to 3,453.24 and KOSPI was down by 0.26 points or 0.01% to 2,564.37.
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