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Indian equity benchmarks ended a lacklustre trading session marginally lower on Monday dragged by losses in Reliance Industries, ICICI Bank, Hindustan Unilever among others. Benchmark indices started the week on a choppy note amid weak global cues. Traders were concerned as a periodic labour force survey by the National Statistical Office (NSO) showed that unemployment rate for all ages in urban areas rose to 10.3 per cent in October-December 2020 as compared to 7.9 per cent in the corresponding months a year ago. Some cautiousness also came in as India Ratings and Research (Ind-Ra) said that salaried and wages earners will be a drag on overall economic recovery in medium term due to tepid recovery of household consumption. Indian indices extended its early losses in a volatile session, ahead of the Consumer Price Index (CPI) data scheduled to be released later today.

However, buying around lower levels helped benchmarks recover most of their intraday losses in noon deals. Traders also found some solace with Reserve Bank of India (RBI) Governor Shaktikanta Das’ statement that central bank is quite optimistic about its 9.5 percent GDP growth estimate coming true for FY22, and will take steps to gradually move for a cool off in headline inflation to its 4 per cent target. He said the growth will keep rising from a sequential perspective with every quarter, and expected the September quarter to be better than June. Some support also came with data showing that Industrial production surged 11.5 per cent in July mainly due to a low-base effect and good performance by manufacturing, mining and power sectors but the output remained slightly below the pre-pandemic level. Meanwhile, the commerce ministry's investigation arm DGTR has recommended the imposition of anti-dumping duty on certain aluminium products from China to guard domestic manufacturers from cheap imports.

On the global front, Asian markets ended mostly lower on Monday, as traders continue to express concerns that the surge coronavirus cases in the region and other countries, particularly in the U.S., could dent the pace of global economic recovery from the pandemic. European markets were trading in green as hopes for a strong euro zone economic recovery outweighed concerns over fresh regulatory crackdown on Chinese firms. Back home, on the sectoral front, there was some buzz in power stocks as power ministry data showed that India's power consumption grew 5.45 per cent in the first week of September to 27.41 billion units (BU), showing consistent recovery after easing of lockdown curbs by states. Banking stocks also were in watch as Fitch Ratings said Indian banks' improved performance for the financial year ended March 2021 (FY21) is in contrast to the stress evident from extension of Covid-19-related relief measures to borrowers. Sugar industry’s stocks too were in action as industry body ISMA said India, the world's second largest sugar producer, can export 6 million tonne of the sweetener in the 2021-22 season commencing next month, taking advantage of the firm global market.

Finally, the BSE Sensex fell 127.31 points or 0.22% to 58,177.76 and the CNX Nifty was down by 13.95 points or 0.08% to 17,355.30.   

The BSE Sensex touched high and low of 58,314.64 and 57,944.63, respectively and there were 20 stocks advancing against 10 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 0.32%, while Small cap index up by was 0.80%.

The top gaining sectoral indices on the BSE were Metal up by 1.47%, Utilities up by 1.20%, Basic Materials up by 1.08%, Telecom up by 0.71%I and IT up by 0.68%, while Energy down by 1.51%, Bankex down by 0.50%, Consumer Durables down by 0.18% and Finance down by 0.18% were the top losing indices on BSE.

The top gainers on the Sensex were TCS up by 1.38%, Bharti Airtel up by 1.36%, Bajaj Finserv up by 1.21%, Tata Steel up by 1.09% and Maruti Suzuki up by 1.05%. On the flip side, Reliance Industries down by 2.22%, ICICI Bank down by 1.79%, Hindustan Unilever down by 0.86%, HDFC Bank down by 0.78% and Mahindra & Mahindra down by 0.71% were the top losers.

Meanwhile, Industry chamber Ficci in its latest quarterly survey (Q2) has said that the outlook for increased manufacturing activities in the second quarter of this fiscal (Q2FY22) has been significantly improved, though the cost of doing business and production is rising. As per Ficci's survey on manufacturing, industry respondents have attributed the hike in production costs primarily to high fixed costs, higher overhead costs for ensuring safety protocols, and a drastic reduction in volumes due to lockdown.

The hike was also attributed to lower capacity utilisation, high freight charges and other logistic costs, increased cost of raw materials, power cost, and high-interest rates. It said that after experiencing subdued Q1 (April-June 2021-22), the outlook seems to have improved significantly in the second quarter (July-September).

However, the survey noticed a high percentage of respondents experiencing the rising cost of doing business and production. On exports, it said the outlook seems improving as around 58 per cent of the participants are expecting a rise in their outbound shipments during the second quarter. The survey added hiring outlook for the sector remains subdued as 68 per cent mentioned that they are not likely to hire additional workforce in the next three months. Responses have been drawn from over 300 manufacturing units from both large and SME segments with a combined annual turnover of over Rs 2.7 trillion.

The CNX Nifty traded in a range of 17,378.35 and 17,269.15 and there were 30 stocks advancing against 20 stocks declining on the index.     

The top gainers on Nifty were Coal India up by 3.90%, Hindalco up by 3.27%, Kotak Mahindra Bank up by 1.71%, Tata Steel up by 1.59% and BPCL up by 1.58%.
On the flip side, Reliance Industries down by 2.30%, ICICI Bank down by 1.77%, SBI Life Insurance down by 0.87%, Hindustan Unilever down by 0.84% and HDFC Bank down by 0.82% were the top losers.

European markets were trading in green; UK’s FTSE 100 increased 42.66 points or 0.61% to 7,071.86, France’s CAC increased 39.67 points or 0.6% to 6,703.44 and Germany’s DAX increased 140.54 points or 0.9% to 15,750.35.

Asian markets ended mostly lower on Monday due to lingering concerns over the impact of corona-virus pandemic in Asian region. Meanwhile, US dollar marched higher on cautious mood amid uncertainty about US inflation coupled with China's crackdown on tech companies. Chinese shares ended higher, despite the latest moves from Beijing to reshape online businesses with reports showing that Beijing wants to break up Ant Group's Alipay and create a separate app for the company's highly profitable loans business. Meanwhile, Chinese banks extended 1.22 trillion yuan ($189.51 billion) in new yuan loans in August, up from July but falling short of expectations. Japanese shares settled higher amid raising bets that Taro Kono will become the country's next prime minister.

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