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Home >Markets >Stock Markets >Sensex falls 150 points, Nifty below 17,350; HCL Tech & ICICI Bank top losers

Asian share markets opened lower today as investors sought to lock in profits following recent rallies, with losses on Wall Street also weighing on the market.

The Hang Seng plunged 2.1%, while the Shanghai Composite is trading on a flat note. The Nikkei is trading down by 0.3%.

In US stock markets, Wall Street indices finished lower on Friday as doubts about the resilience of the global economic recovery hurt former reopening darlings in energy, hotels and travel.

Data on Friday showed US producer prices increased solidly in August, leading to the biggest annual gain in nearly 11 years. The reading sent the benchmark US 10-year Treasury yield higher.

The Dow Jones Industrial Average ended down by 270 points, or 0.8%. The index was down for a fifth straight day and shed 2.2% last week, a second consecutive week of decline for the index.

Meanwhile, the Nasdaq Composite ended down by 133 points or 0.9%. It declined 1.6% for the week.

Back home, Indian share markets have opened on a negative note.

The BSE Sensex is trading down by 149 points. Meanwhile, the NSE Nifty is trading lower by 41 points.

HDFC and Maruti Suzuki are among the top gainers today. HCL Tech, on the other hand, is among the top losers today.

The BSE Mid Cap index and the BSE Small Cap index have opened up by 0.1% and 0.3%, respectively.

Sectoral indices are trading mixed with stocks in the metal sector and FMCG sector witnessing buying interest.

Oil & gas stocks and banking stocks, on the other hand, are trading in red.

Shares of Hindalco and NALCO hit their 52-week highs today.

The rupee is trading at 73.58 against the US$.

Gold prices are trading up by 0.2% at 46,896 per 10 grams.

Meanwhile, silver prices are trading down by 0.3% at 63,392 per kg.

Gold is subdued today as the dollar held firm, while cautious investors awaited readings on US consumer prices due this week.

Crude oil prices climbed to a one-week high today as concerns over US supplies following damage from Hurricane Ida supported the market, along with expectations for higher demand.

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In news from the power sector, Tata Power is among the top buzzing stocks today.

Tata Power and Adani group have been told to submit revised bids for South East UP Power Transmission by the power transmission company’s lenders.

Both had submitted binding offers for the company in the second week of August alongside three other bidders including Power Grid Corporation.

However, both of their offers were conditional on lenders securing reversal of a suspension order on a 1,600-km project the company is carrying out, imposed by the state power transmission authority for delays in completion.

People close to the development said the lenders are not agreeable to this condition.

Lenders including Bank of India, Axis Bank, Power Finance Corporation (PFC) and Rural Electrification Corporation (REC) had wrested control of the transmission company from Spain’s Grupo Isolux Corsan after it defaulted on dues.

South East UP Power had won a 35-year concession to build and operate a power transmission network in Uttar Pradesh and took loans of around 37 bn from local lenders.

The parent company eventually filed for bankruptcy in Spain, leaving the Indian unit saddled with debt and without financial support.

Tata Power and Adani have submitted offers upwards of 26 bn. Tata has bid through its arm Resurgent Power Ventures.

According to reports, the competition for acquisition is indicating strong investor interest in the power transmission sector, which is dominated by public sector companies.

How and when the acquisition finalizes remains to be seen.

Speaking of Tata Power, have a look at the chart below to see how the stock has performed in the past year.

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Moving on to news from the mutual funds space, record systematic investment plans (SIPs) have brought a cheer to the 36-tn domestic mutual fund (MF) industry.

In the month of August, inflows through SIP route touched nearly 100 bn and new SIP registration touched an all-time high of 2.5 m.

This comes even as markets trade at expensive valuations.

The total assets under management (AUM) for SIPs also touched a new record at 5.3 tn.

SIP inflows have been more than 90 bn in each of the last three months. So far this fiscal, inflows through the SIP route have exceeded 460 bn.

In fiscal 2021, even when equity funds continued to witness outflows, SIP had continued to remain strong, bringing in nearly 960 bn of net inflows.

Market experts believe there is scope for the SIP book to swell further driven by penetration of digital platforms.

Strong SIP flows is a big positive for the industry. Typically, SIP investors continue with their investments irrespective of the market levels. On the other hand, investors putting in lump sums tend to churn their holdings more frequently.

For instance, equity inflows in August dropped 62% to 86.7 bn in August against a record 225.8 bn in July.

However, SIP flows increased sequentially.

This just shows that SIP investors are in for a long haul instead of how they used to do it earlier - for an average time frame of three years.

Seeing this from a big picture view, shows that huge money keeps continuously pouring into the stock markets despite all the bad news about the economy.

How SIP activity pans out in the coming months remains to be seen.

This article is syndicated from Equitymaster.com

 

 

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