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Indian equity benchmarks snapped their two-day gaining streak and settled marginally lower on Wednesday, amid volatile trading ahead of the expiration of monthly derivates. After making cautious start, the benchmark indices swung between gains and losses for whole day, in tandem with weak global market cues. Caution prevailed among investors with the finance ministry’s report stated that the government's total liabilities (including liabilities under the 'Public Account') stood at Rs 125.71 lakh crore in the September quarter (Q2FY22), up 3.97 per cent from the previous quarter. The total liabilities of the government were Rs 120.91 lakh crore in the three months ended June (Q1FY22). Traders remain worried as India reported 6,358 new coronavirus cases on Tuesday, according to the health ministry. The active caseload of the country now stands at 75,456. Omicron cases have risen to 653.

However, losses remain capped as some optimism remained among traders with rating agency ICRA in its latest report stated that India’s real gross domestic product (GDP) is likely to maintain a 9% growth rate in fiscal 2022 and 2023. The Indian economy grew at 8.4% in the second quarter of the current fiscal, as against a growth of 20.1% in the April-June quarter. Some support also came with the Reserve Bank of India’s (RBI) report said that non-banking financial companies (NBFCs) are expected to remain buoyant going ahead, with the increased pace of vaccinations and the broadening revival of the economy. It said the COVID-19 pandemic has tested the resilience of NBFCs, but so far, the sector has emerged stronger with reasonable balance sheet growth, increased credit intermediation, higher capital, lower delinquency ratio and enlarged liquidity cushions. Traders also took note of report that Finance Minister Nirmala Sitharaman will hold a meeting with finance ministers of states on Thursday as part of customary pre-Budget consultations with various stakeholders.

On the global front, Asian markets ended mixed on Wednesday as cautious undertone prevailed amid renewed concerns about the emergence of new Covid variants and the threat of inflation. Omicron still poses 'very high' risk and could overwhelm healthcare systems, the World Health Organization (WHO) warned, as the highly transmissible coronavirus variant fueled record outbreaks in many countries. European markets were trading mostly in green supported by gains in banks and retail stocks.

Back home, on the sectoral front, shares of pharma majors kept markets afloat for most part of today's session with repot that thirteen Indian companies can now manufacture and market oral antiviral drug Molnupiravir developed by Merck and Ridgeback Biotherapeutics after the country’s drug regulator granted approval for restricted use under emergency situations for Covid-infected adults in high-risk category. The approval for Molnupiravir assumes significance, as it can become an affordable oral treatment for Covid. Stocks related to textiles sector too were in watch as the government issued the operational guidelines for the Production Linked Incentive (PLI) Scheme for the textiles sector with an approved outlay of Rs 10,683 crore, in order to promote production of MMF Apparel, MMF Fabrics and Products of Technical Textiles in the country.

Finally, the BSE Sensex fell 90.99 points or 0.16% to 57,806.49 and the CNX Nifty was down by 19.65 points or 0.11% to 17,213.60.        

The BSE Sensex touched high and low of 58,097.07 and 57,684.58, respectively and there were 11 stocks advancing against 19 stocks declining on the index.   

The broader indices ended in green; the BSE Mid cap index rose 0.13%, while Small cap index was up by 0.49%.

The top gaining sectoral indices on the BSE were Healthcare up by 1.71%, Auto up by 0.44%, Consumer discretionary up by 0.16%, Capital Goods up by 0.14% and Telecom up by 0.13%, while Metal down by 1.01%, PSU down by 0.72%, Power down by 0.65%, Utilities down by 0.64% and Bankex down by 0.43% were the losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 2.86%, Indusind Bank up by 1.99%, Dr. Reddy's Lab up by 1.66%, Titan Company up by 0.89% and Bajaj Finserv up by 0.87%. On the flip side, SBI down by 1.45%, ITC down by 1.43%, Tech Mahindra down by 1.09%, Tata Steel down by 1.00% and NTPC down by 0.89% were the top losers.

Meanwhile, in order to promote production of MMF Apparel, MMF Fabrics and Products of Technical Textiles in the country, the government has issued the operational guidelines for the Production Linked Incentive (PLI) Scheme for the textiles sector with an approved outlay of Rs 10,683 crore. An Empowered Group of Secretaries (EGoS) chaired by the Cabinet Secretary will monitor the progress of the scheme and take appropriate action to ensure that the expenditure is within the prescribed outlay. The EGoS is also empowered to make any changes in the modalities of the scheme and address any issue related to genuine hardship that may arise during the course of implementation.

As per the prescribed norms, the scheme is in operation from September 24, 2021 to March 31, 2030 and the incentive under the scheme will be payable for a period of 5 years only. Any company/firm/LLP/trust willing to create a separate manufacturing firm under the Companies Act 2013, and invest a minimum Rs 300 crore, excluding land and administrative building cost, to manufacture notified products will be eligible to get the incentive when they achieve a minimum of Rs 600 crore turnover by the first performance year.

Under the scheme, FY 2024-25 will be considered as the first performance year with a minimum prescribed turnover of Rs 600 crore, according to the guidelines issued by the textiles ministry. Also any company/firm/LLP/trust willing to create separate a manufacturing company under the Companies Act 2013, and invest a minimum Rs 100 crore, excluding land and administrative building cost, to manufacture notified products will be eligible to get incentive when they achieve a minimum of Rs 200 crore turnover by the first performance year. The ministry will accept online applications under the scheme from January 1, 2022, through the PLI portal. The application window will remain open till January 31, 2022.

The CNX Nifty traded in a range of 17,285.95 and 17,176.65 and there was 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Eicher Motors up by 3.41%, Bajaj Auto up by 2.93%, Sun Pharma up by 2.33%, Divi's Lab up by 2.05% and Indusind Bank up by 1.71%. On the flip side, SBI down by 1.73%, ITC down by 1.57%, Coal India down by 1.51%, Grasim Industries down by 1.23% and NTPC down by 1.21% were the top losers.

European markets were trading mostly in green; UK’s FTSE 100 increased 73.65 points or 1% to 7,445.75 and France’s CAC increased 4.26 points or 0.06% to 7,185.37, while Germany’s DAX decreased 45.66 points or 0.29% to 15,918.04.

Asian markets ended mixed on Wednesday amid profit taking following weakness in Wall Street overnight, while investors are hopeful for the global economic recovery despite risks from the Omicron variant of the coronavirus and tightening monetary policy. Chinese shares dropped in cautious trade as Chinese city of Xian entered its seventh day of lockdown with tighter restrictions after 151 cases reported for Tuesday. Japanese stocks closed lower in thin year-end trade. Fall in US futures shares also pushed down the Japanese market.

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