Weak trade continues in Indian markets in early afternoon deals

A weak trade continued over the Dalal Street in early afternoon deals, with both Sensex and Nifty trading lower, on the back of selling at Auto and Oil & Gas counters, despite positive cues from other Asian markets. Traders remained cautious, as think tank GTRI said that India's imports of goods from countries with which it has a free trade agreement like the UAE, South Korea, and Australia grew about 38 per cent during 2019-24 fiscal years to $187.92 billion. On the other hand, the country's exports to the FTA (free trade agreement) partners rose 14.48 per cent to $122.72 billion in 2023-24 from $107.20 billion in 2018-19.

On the global front, Asian markets were trading mostly in green, after Indonesian consumers continued to express a positive attitude in April, with their confidence strengthening to the strongest level in almost a year. The survey data from the Bank Indonesia showed that the consumer confidence index climbed to 127.7 in April from 123.8 in the previous month. A reading above 100 indicates optimism among households. Further, this was the highest score since May 2023, when it was 128.3.

Back home, OMCs stocks were in watch, as the Ministry of Petroleum & Natural Gas in its latest notification has showed that the combined profit of oil marketing companies (OMCs) for FY 2023-24 (FY24) stood at Rs 86,000 crore, over 25 times higher than the extraordinarily difficult previous fiscal year. Even as they navigated rapidly evolving geo politics and wide fluctuations in crude prices, the OMCs not only ensured fuel availability at affordable rates, with one of the lowest fuel price inflation globally in India, but they have also rewarded the shareholders’ trust by posting commendable annual results.

The BSE Sensex is currently trading at 72468.17, down by 196.30 points or 0.27% after trading in a range of 71866.01 and 72603.18. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell by 0.45%, while Small cap index was down by 0.52%.

The top gaining sectoral indices on the BSE were Capital Goods up by 0.93%, Healthcare up by 0.72%, Industrials up by 0.57% and Power up by 0.10%, while Auto down by 1.96%, Oil & Gas down by 1.26%, Energy down by 1.26%, Consumer Disc down by 1.15% and Utilities down by 1.14% were the top losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 3.54%, HDFC Bank up by 0.94%, Larsen & Toubro up by 0.87%, Sun Pharma up by 0.70% and TCS up by 0.68%. On the flip side, Tata Motors down by 8.22%, Indusind Bank down by 1.52%, SBI down by 1.23%, NTPC down by 1.22% and Maruti Suzuki down by 0.87% were the top losers.

Meanwhile, Textiles Secretary Rachna Shah has said that the government will accord focused attention to promote India's textiles exports, which declined for the second year in a row in 2023-24. The government has set an ambitious target to achieve $100 billion export for textile products by 2030. The cumulative exports of textiles and apparel from India during April 2023-March 2024 registered a de-growth of 3.24 per cent at $ 34.4 billion, as compared to $ 35.5 billion in April 2022-March 2023. In 2021-22, outward shipments of textiles and apparel were recorded at over $ 41 billion.

On the decline in India's textiles exports in 2023-24, Shah said ‘we had challenges like the Red Sea crisis making it slightly more challenging.’ Although geo-political challenges remain, she said some exporters have reported improvement in their order books in the first quarter and the shipments are likely to improve in the coming months. She said ‘we will be looking at more focused attention on products which have greater export potential and the production linked incentive (PLI) scheme is focused on those globally traded products.’ Shah also outlined other measures being looked at to promote exports from the sector, including ‘possibly looking at newer markets’. She added that the free trade agreements (FTAs), which India has entered into with other nations hopefully will open up more opportunities for the textiles exports.

Sharing the outlook for outward shipments from the textiles sector, she said ‘we should look at higher exports happening now. The global demand also will start looking better. Already in the first quarter we have seen some of our exporters have reported that the order positions for apparel, made-ups etc, is looking up so that should play out’. She noted that India has been losing ground in global garments trade to countries like Bangladesh and Vietnam due to their lower labour costs, larger operation footprints, and benefits from free trade agreements.

The CNX Nifty is currently trading at 22014.15, down by 41.05 points or 0.19% after trading in a range of 21821.05 and 22067.30. There were 16 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were Cipla up by 5.60%, Asian Paints up by 3.61%, Divi's Lab up by 2.39%, HDFC Life Insurance up by 2.01% and Britannia Inds up by 1.81%. On the flip side, Tata Motors down by 8.27%, BPCL down by 2.21%, Hero MotoCorp down by 2.08%, Indusind Bank down by 1.57% and Coal India down by 1.57% were the top losers.

Asian markets were trading mostly in green; Jakarta Composite gained 6.52 points or 0.09% to 7,095.32, Taiwan Weighted gained 118.01 points or 0.57% to 20,826.85, Hang Seng rose 115.96 points or 0.61% to 19,080.45 and Straits Times was up by 7.42 points or 0.22% to 3,298.12, while Nikkei 225 fell 124.82 points or 0.33% to 38,104.29, KOSPI dropped 10.90 points or 0.40% to 2,716.73, Shanghai Composite was down by 6.53 points or 0.21% to 3,148.02.