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Indian markets witness further fall during early noon
Jan-06-2025

Indian equity markets witnessed further fall during early afternoon session, as investors chose to play it safe, after the Indian government confirmed two cases of Human Metapneumovirus (HMPV) in Karnataka amid reports of a virus outbreak creating havoc in China. Adding more worries among market participants, a private report stated that India's current account deficit (CAD) is expected to remain elevated in FY26 due to stringent global trade policies. The report highlighted that the country's imports have consistently outpaced exports, leading to a widening trade deficit. The risk of a further deterioration in India's trade balance due to sluggish exports, which will keep the country's current account deficit (CAD) elevated.

On the global front, Asian markets were trading mostly in red, as the private sector in Singapore continued to expand in December, albeit at a slower pace, with a PMI score of 51.5. That's down from 53.9 in November, although it remains well above the boom-or-bust line of 50 that separates expansion from contraction.

The BSE Sensex is currently trading at 78193.40, down by 1029.71 points or 1.30% after trading in a range of 77959.95 and 79532.67. There was 1 stock advancing against 29 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell by 1.84%, while Small cap index was down by 2.48%.

The top losing sectoral indices on the BSE were Utilities down by 3.25%, Power down by 2.82%, PSU down by 2.74%, Oil & Gas down by 2.70% and Metal down by 2.61%, while there were no gaining sectoral indices on the BSE.

The only gainer on the Sensex was Titan up by 1.18%. On the flip side, ITC down by 7.00%, Tata Steel down by 4.01%, Kotak Mahindra Bank down by 3.16%, Power Grid Corp down by 2.70% and Asian Paints down by 2.59% were the top losers.

Meanwhile, National Bank for Agriculture and Rural Development (NABARD) Chairman Shaji KV has said that India’s rural credit ecosystem is increasingly getting formalised and borrowers across the country are preferring formal sources due to a variety of reasons, including interest subventions and subsidised credit. He said ‘the access of credit from informal sources is actually coming down very drastically. That means that a formalisation of rural credit is happening. Formalisation of rural credit in itself will leave a lot of margins at the hands of the rural people, because if you access an informal source, the rate of interest will be higher, thus margins before them will be lower.’

He said interest-subvented loans through Kisan Credit Cards, agri fund schemes, and a cap on the rate of interest on informal means put together helped formalisation of rural credit. Rural consumption in India is improving and the rate of growth in rural consumption is better than urban consumption, creating a lot of demand in the rural pockets. Going ahead, with farmgate infrastructure being set up across the country, he said there now is a need to shift people out of agricultural production to value-added processing through a value chain development.

He said agri credit growth is expected to be more than 13 per cent this fiscal 2024-25. Agri credit growth has been on an average at 13 per cent over the past ten years. He said ‘this year we will be achieving around 27 to 28 lakh crore in agriculture credit.’

The CNX Nifty is currently trading at 23679.05, down by 325.70 points or 1.36% after trading in a range of 23601.50 and 24089.95. There were 4 stocks advancing against 46 stocks declining on the index.

The top gainers on Nifty were Apollo Hospital Ent. up by 1.42%, Titan up by 1.01%, Tata Consumer Products up by 0.14% and ICICI Bank up by 0.01%. On the flip side, ITC down by 6.95%, Tata Steel down by 4.20%, BPCL down by 3.44%, Kotak Mahindra Bank down by 3.17% and Coal India down by 3.06% were the top losers.

Asian markets were trading mostly in red; Hang Seng declined 94.13 points or 0.48% to 19,666.14, Jakarta Composite plunged 65.18 points or 0.91% to 7,099.25, Shanghai Composite weakened 5.79 points or 0.18% to 3,205.64 and Nikkei 225 slipped 587.49 points or 1.49% to 39,307.05, while Straits Times rose 12.07 points or 0.32% to 3,813.90, KOSPI increased 46.72 points or 1.88% to 2,488.64 and Taiwan Weighted added 639.41 points or 2.72% to 23,547.71.
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