Indian Share Markets Open Flat; Realty & Metal Stocks Drag

Asian stock markets are higher today as Japanese and Hong Kong shares show gains. The Nikkei 225 is flat while the Hang Seng is up 0.4%. The Shanghai Composite is trading up by 1.4%. Wall Street’s major indices rose on Monday on optimism over trade talks between the United States and China, though they fell from session highs after President Donald Trump criticized the Federal Reserve’s raising interest rates.

Back home, India share markets have opened the day on a flattish note. The BSE Sensex is trading up by 26 points while the NSE Nifty is trading up by 15 points. The BSE Mid Cap index opened up by 0.4% while BSE Small Cap index opened the day up by 0.3%.

The rupee is currently trading at 69.76 to the US$.

Sectoral indices have opened the day on a mixed note with automobile stocks and information technology stocks witnessing maximum buying interest. While, realty stocks and metal stocks have opened the day in red.

In the news from the economy. As per Fitch Ratings Ltd, the impact of the sharp fall in the rupee is likely to be limited on India’s sovereign ratings.

The fallout is limited courtesy India’s strong external finances, especially the low levels of external debt, the rating agency said. However, in a note of caution, Fitch said the currency depreciation could add to existing pressures in the corporate and banking sector.

The rupee has been one of the worst performers among Asian currencies, having depreciated by around 9% from the beginning of the year and crossed the psychological level of 70 to a dollar earlier this month.

Fitch said the rupee has been among the emerging market currencies affected by pressures from global monetary tightening and, more recently, contagion from the Turkey crisis.

Widening of the trade deficit in July 2018 to its largest gap since May 2013 and net portfolio outflows through mid-August totalling US$5.5 billion for the year, mostly in bonds, compared with inflows of US$27.9 billion over the same period in 2017 have also added to the pressure on the rupee, it said in a note.