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Markets erase gain to turn negative

Indian bourses erased all its gains in noon session as selling appeared in utilities, auto and power stocks with Sensex and Nifty tumbling by 67 and 17 points respectively. Traders were worried as Icra Ratings said with the benefits of unlocking measures tapering out, high-frequency indicators have become uneven since August. The performance of the high-frequency indicators in August 2021 was decidedly uneven, especially when compared to the pre-COVID levels. However, downfall remain limited as Reserve Bank of India (RBI) in its latest survey has showed that exports of software services, including services delivered by foreign affiliates of Indian companies, recorded 2.1 per cent growth during 2020-21 and stood at $148.3 billion. On the global front; Asian markets were trading mostly lower on contagion fears and selling pressure persisted amid concern that troubles at indebted developer China Evergrande could ripple across the world economy, markets and financial system.

The BSE Sensex is currently trading at 58423.69, down by 67.24 points or 0.11% after trading in a range of 58232.54 and 58779.42. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 0.25%, while Small cap index was down by 0.98%.

The top gaining sectoral indices on the BSE were Realty up by 2.20%, Metal up by 0.48%, Oil & Gas up by 0.45%, TECK up by 0.44% and IT was up by 0.35%, while Utilities down by 1.41%, Auto down by 1.11%, Power down by 1.04%, Bankex down by 1.00% and Industrials was down by 0.53% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 1.33%, Dr. Reddy's Lab up by 1.16%, Tech Mahindra up by 1.14%, Asian Paints up by 1.13% and Bajaj Finserv was up by 1.11%. On the flip side, Maruti Suzuki down by 2.51%, Bajaj Auto down by 1.77%, Axis Bank down by 1.61%, HDFC Bank down by 1.55% and ICICI Bank was down by 1.42% were the top losers.

Meanwhile, Apex exporters' body Federation of Indian Export Organisations (FIEO) has said that it will focus on new products and markets for diversification with a view to boosting the country's outbound shipments. Further, FIEO President A Sakthivel said that the order booking position is encouraging till October, but many exporters are not in a position to take further contracts due to erosion of liquidity and uncertainties on the policy front.

Sakthivel said ‘I have raised the issue of shortage of containers, frequent shutouts by the shipping lines and exorbitant freight rates, that are having a dampening effect on the exports, with Commerce Minister Piyush Goyal.’ He also said that the other issues which FIEO has raised with the government include rationalization of the export policy of raw material to strike a balance between exports and domestic requirement; automatic enhancement of the existing working capital requirement by 20-25 percent by banks; extension of factoring facilities with institutions like ECGC; and removal of transport and logistics problems by regulating the movement of empty containers from India.

FIEO President has also highlighted the skyrocketed increase in freight rates between 300 percent to 350 percent and to some destinations like South America and West Africa, it is over 500 percent. He also suggested that freight subsidy may be given till freight charges normalize. He added that large ships may be encouraged to call on some Indian ports so that the backlog is reduced, and the Shipping Corporation of India may be asked to take a few ships on lease for sailing to major exports/imports destinations.

The CNX Nifty is currently trading at 17379.50, down by 17.40 points or 0.10% after trading in a range of 17326.10 and 17481.10. There were 28 stocks advancing against 22 stocks declining on the index.

The top gainers on Nifty were ONGC up by 3.23%, JSW Steel up by 3.13%, UPL up by 2.71%, Cipla up by 2.05% and Indusind Bank was up by 1.28%. On the flip side, Maruti Suzuki down by 2.52%, Hero MotoCorp down by 1.98%, Axis Bank down by 1.91%, Bajaj Auto down by 1.86% and HDFC Bank was down by 1.64% were the top losers.

Asian markets were trading mostly lower; Hang Seng decreased 25.53 points or 0.11% to 24,073.61, Jakarta Composite lost 39.40 points or 0.65% to 6,036.92 and Nikkei 225 was down by 660.34 points or 2.17% to 29,839.71.

On the other hand; Straits Times was up 12.16 points or 0.4% to 3,053.89.

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