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Indian equity benchmarks trimmed some of their losses in afternoon session, but continue to trade below the neutral lines with Sensex and Nifty trading below at 52,600 and 15,800 respectively. Traders were worried as Moody's Investors Service slashed India's growth projection to 9.6 per cent for 2021 calendar year, from its earlier estimate of 13.9 per cent, and said faster vaccination progress will be paramount in restricting economic losses to June quarter. Earlier this month, Moody's had projected India to clock a 9.3 per cent growth in the current fiscal ending March 2022, but severe second COVID wave has increased risks to India's credit profile and rated entities. However, downfall remain capped as report stated that Indian companies' market capitalization has grown at the fastest pace last year among major economies despite contraction in GDP.

On the global front, Asian markets were trading higher as Federal Reserve chairman states that the high U.S. inflation is probably temporary, helping to calm fears central bankers might feel pressure to roll back economic stimulus. Back home, in scrip specific development, UBL shares were under pressure as the debts recovery tribunal (DRT) sold shares worth over Rs 5,800 crore of United Breweries (UBL) that were earlier attached under the anti-money laundering law as part of an alleged bank fraud probe against fugitive liquor baron Vijay Mallya.

The BSE Sensex is currently trading at 52550.38, down by 38.33 points or 0.07% after trading in a range of 52434.70 and 52912.35. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.29%, while Small cap index was up by 0.16%.

The top gaining sectoral indices on the BSE were Auto up by 1.08%, Consumer Durables up by 0.89%, PSU up by 0.59%, Consumer Discretionary up by 0.58%, Realty was up by 0.49%, while Oil & Gas down by 0.79%, Energy down by 0.46%, TECK down by 0.40%, IT down by 0.37% and Telecom was down by 0.24% were the top losing indices on BSE.

The top gainers on the Sensex were Maruti Suzuki up by 2.65%, Titan Company up by 1.09%, Bajaj Finance up by 0.97%, Mahindra & Mahindra up by 0.85% and SBI was up by 0.82%. On the flip side, Kotak Mahindra Bank down by 1.10%, HCL Tech down by 0.65%, TCS down by 0.60%, HDFC down by 0.59% and Hindustan Unilever was down by 0.49% were the top losers.

Meanwhile, domestic ratings agency ICRA in its latest report has said that Auto component industry is likely to witness a 70 percent decline in operating profits during first quarter of current financial year (Q1 FY22) due to disruptions caused by the second wave of COVID-19. It noted that the challenges for component manufacturers will be further compounded by the sharp increase in commodity prices, which are generally passed through to original equipment manufacturers (OEMs) with a lag of 3-6 months.

ICRA estimates a revenue loss of 30-40 percent quarter on quarter, and this will translate into a sequential decline in EBITDA of over 70 percent during the first quarter for the industry. Exports have come to the industry's rescue in the last few months, when domestic demand nosedived due to lockdown restrictions. Suppliers dependent solely on domestic demand have been the worst impacted.

Despite the short-term headwinds, ratings agency expects the domestic auto component industry to register a 20-23 percent revenue growth in the current fiscal year, supported by double-digit volume growth across most automobile sub-segments and impact of commodity inflation on realisations. It added that the overall industry revenue will still be almost double than the April-June quarter of last financial year.

The CNX Nifty is currently trading at 15762.30, down by 10.45 points or 0.07% after trading in a range of 15726.60 and 15862.95. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Maruti Suzuki up by 2.65%, Hero MotoCorp up by 1.67%, Hindalco up by 1.27%, Titan Company up by 1.08% and Bajaj Finance was up by 0.97%. On the flip side, Wipro down by 2.21%, Shree Cement down by 1.27%, Adani Ports down by 1.11%, Kotak Mahindra Bank down by 0.92% and HDFC was down by 0.63% were the top losers.

All Asian markets were trading firm; Nikkei 225 surged 26.03 points or 0.09% to 28,910.16, Jakarta Composite soared 12.24 points or 0.2% to 6,100.08, Taiwan Weighted strengthened 161.15 points or 0.94% to 17,236.70, Straits Times advanced 6.31 points or 0.2% to 3,115.51, KOSPI rose 9.23 points or 0.28% to 3,273.11, Shanghai Composite gained 2.37 points or 0.07% to 3,559.78 and Hang Seng was up by 198.59 points or 0.7% to 28,508.35.

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