Selling pressure continues over Dalal Street

Bears continued to hold their tight grip over Dalal Street in early afternoon deals, with both Sensex and Nifty falling around a percent, on the back of heavy selling at all the sectors, despite positive cues from other Asian markets. However, indices managed to stage some recovery to come off their intraday low points, amid a private report stating that urban and rural markets have shown a sequential recovery in consumer demand and rural areas continue to surpass urban areas in volume growth across most regions of India. Further, highlighting the Government’s efforts to reduce compliance burdens and decriminalise laws to promote ease of doing business, Minister of Commerce and Industry, Piyush Goyal has emphasized the need to transform India into a powerhouse of engineering exports as the country advances towards the Viksit Bharat goal. 

On the global front, Asian markets were trading mostly in green, as South Korea posted a current account surplus of $11.12 billion in September, up from $6.60 billion in August. The goods account recorded a $10.67 billion surplus as exports increased annually by 9.9 percent to $61.67 billion and as imports rose 4.9 percent to $51.00 billion, both compared to one year earlier.

The BSE Sensex is currently trading at 79620.77, down by 757.36 points or 0.94% after trading in a range of 79419.34 and 80563.42. There were 3 stocks advancing against 27 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell by 0.38%, while Small cap index was down by 0.01%.

The top losing sectoral indices on the BSE were Metal down by 2.04%, Basic Materials down by 1.31%, Utilities down by 1.22%, Auto down by 1.05% and IT down by 0.99%, while there were no gaining sectoral indices on the BSE. 

The few gainers on the Sensex were SBI up by 0.61%, Tata Steel up by 0.36% and Larsen & Toubro up by 0.09%. On the flip side, Tech Mahindra down by 2.57%, Sun Pharma down by 2.13%, Ultratech Cement down by 1.78%, ICICI Bank down by 1.66% and Tata Motors down by 1.64% were the top losers.

Meanwhile, Reserve Bank of India (RBI) Governor Shaktikanta Das has said that the incoming data on economic growth is ‘mixed’, but the positive factors outweigh the negative ones. He stressed that the underlying economic activity by and large remains strong. He said it can be noted that many analysts have been voicing concerns about growth, especially after official data showed growth slowing to a 15-quarter low of 6.7 per cent in the first quarter of FY25. However, the RBI has been holding onto its estimate of 7.2 per cent real GDP growth for FY25, even as some expect it to be lower than 7 per cent. 

RBI Governor said the RBI tracks over 70 high-speed indicators to arrive at its estimates and described both the positive factors pushing the number and the negatives pulling it down. The industrial production or IIP data, and moderation in urban demand being witnessed by fast-moving consumer goods companies are the negative factors. Besides, subsidy outgoes have increased in the September quarter and will impact the Q2 GDP number. The positives include the handsome growth in GST e-way bills, toll collections, air passenger traffic, and steel and cement industry performance. Amid the increased discussion on the auto sector prospects recently with concerns around rising inventory amid lower demand, Das said the sector has done exceedingly well in October with a 30 per cent growth which includes a 23 per cent rise in four-wheeler sales. Additionally, the agriculture and services sectors are also doing well.

On inflation, he said the October headline consumer price inflation number to be announced on November 12 will be higher than September’s 5.5 per cent, but added that the central bank had already pencilled in the higher numbers for the two months. He said the shift in stance of the monetary policy should not be seen as a precursor to a rate cut at the very next meeting of the rate-setting panel. He added that the panel is under no pressure on the next course of action. 

The CNX Nifty is currently trading at 24221.00, down by 263.05 points or 1.07% after trading in a range of 24181.95 and 24503.35. There were 5 stocks advancing against 45 stocks declining on the index.

The top gainers on Nifty were Apollo Hospital up by 6.28%, SBI up by 0.66%, HDFC Life Insurance up by 0.40%, Tata Steel up by 0.35% and Larsen & Toubro up by 0.21%. On the flip side, Hindalco down by 8.07%, Trent down by 5.57%, Grasim Industries down by 3.16%, Shriram Finance down by 2.97% and Tech Mahindra down by 2.52% were the top losers.

Asian markets were trading mostly in green; Hang Seng advanced 351.71 points or 1.71% to 20,890.09, Shanghai Composite strengthened 84.92 points or 2.51% to 3,468.73, Straits Times rose 74.91 points or 2.08% to 3,677.90, KOSPI increased 1.12 points or 0.04% to 2,564.63 and Taiwan Weighted added 191.44 points or 0.82% to 23,408.82, while Jakarta Composite plunged 91.57 points or 1.24% to 7,292.30 and Nikkei 225 slipped 99.26 points or 0.25% to 39,381.41.