Domestic indices remain in red in late morning deals

Domestic equity markets remained in red and were trading with cut of over half percent in late morning deals, impacted by a lackluster earnings season and continued foreign selling. Foreign institutional investors (FIIs) offloaded equities worth Rs 3,228.08 crore on October 28, according to exchange data. Meanwhile, broader indices were also trading in red with BSE Mid cap index and Small cap index falling in the range of 0.65-0.85%.  Hectic selling in Tata Motors, Mahindra & Mahindra, Indusind Bank, Bharti Airtel and Maruti Suzuki weighed on the markets. Traders were cautious as private report said the Indian economy has entered a phase of 'cyclical growth slowdown' and the Reserve Bank's estimate of 7.2 per cent GDP expansion is 'overly optimistic'. Almost all sectoral indices on the BSE were trading in red led by Auto, Telecom, Metal, Oil & Gas and Consumer Disc.

On the global front, Asian markets were trading mostly in red despite positive cues from the US markets overnight. Traders remained cautious ahead of the release of key US economic data later in the week that could impact the expectations regarding how quickly the US Fed will lower interest rates. In the stock specific development, JSW Infrastructure shares gained after the company reported highest-ever quarterly profit in Q2FY25. 

The BSE Sensex is currently trading at 79590.38, down by 414.66 points or 0.52% after trading in a range of 79421.35 and 80104.59. There were 6 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.83%, while Small cap index down by 0.65%.

The only gaining sectoral index on the BSE was Bankex up by 0.43%, while Auto down by 2.16%, Telecom down by 1.71%, Metal down by 1.70%, Oil & Gas down by 1.50% and Consumer Disc down by 1.37% were the top losing indices on BSE.

The top gainers on the Sensex were ICICI Bank up by 1.67%, SBI up by 0.81%, NTPC up by 0.71%, Larsen & Toubro up by 0.50% and Bajaj Finserv up by 0.05%. On the flip side, Tata Motors down by 4.00%, Mahindra & Mahindra down by 2.44%, Indusind Bank down by 2.34%, Bharti Airtel down by 2.22% and Maruti Suzuki down by 2.17% were the top losers.

Meanwhile, the Global Trade Research Initiative (GTRI) has said that shortage of Cold-Rolled Grain-Oriented (CRGO) steel used for making transformers and electric motors could impact India's ambitious power sector expansion plans. It said that India's power sector is facing a 30 per cent shortage of CRGO steel, essential for electric motors and transformers. It also said with domestic production meeting only about 10-12 per cent of demand, India relies heavily on imports.

GTRI said the immediate cause of the CRGO steel shortage is import uncertainty caused by the delayed license renewals by the Bureau of Indian Standards (BIS) for many foreign suppliers from Japan, South Korea and China. Many of the licenses are set to expire soon, causing shortages and uncertainty in the power sector. It added that foreign suppliers require BIS certification under a Quality Control Order, which ensures quality but restricts options to a few approved grades and vendors. The entire BIS process needs an urgent review by independent auditors. 

In the long term, India must prioritise local production, as CRGO is now considered a strategic material, and supply may remain limited. Without action, this shortage could jeopardise India's ambitious energy goals. CRGO's grain orientation reduces energy loss, making it essential for transformer cores, which are central to India's power distribution network. In FY 2024, India, one of the largest consumers of CRGO steel, required 400,000 tonnes. With only 50,000 tonnes produced domestically, it had to import 239.2 thousand tonnes from countries like China, Japan, Russia and South Korea. After exporting 11.4 thousand tonnes, only 277.8 thousand tonnes were available for local use, leaving a shortfall of 122.2 thousand tonnes, or 30.6 per cent of total demand.

The CNX Nifty is currently trading at 24194.00, down by 145.15 points or 0.60% after trading in a range of 24140.85 and 24378.65. There were 11 stocks advancing against 39 stocks declining on the index.

The top gainers on Nifty were ICICI Bank up by 1.66%, SBI Life up by 1.07%, Bharat Electronics up by 1.04%, Eicher Motors up by 0.99% and SBI up by 0.88%. On the flip side, Tata Motors down by 4.04%, Bajaj Auto down by 3.04%, Dr. Reddy's Lab down by 2.87%, Hero MotoCorp down by 2.45% and Cipla down by 2.37% were the top losers.

Asian markets were trading mostly in red; Jakarta Composite plunged 16.38 points or 0.22% to 7,618.25, Shanghai Composite weakened 24.15 points or 0.73% to 3,298.05, Straits Times fell 3.62 points or 0.1% to 3,580.46, KOSPI dropped 2.25 points or 0.09% to 2,610.18 and Taiwan Weighted lost 338 points or 1.48% to 22,860.07. However, Hang Seng advanced 70.28 points or 0.34% to 20,669.64 and Nikkei 225 surged 265.64 points or 0.68% to 38,871.17.