INDICES TRADE WITH MAJOR LOSSES; PRIVATE BANKS TUMBLE

The leading equity indices continued to trade with deep cuts in mid-afternoon trade amid mixed cues from global markets and fears of full fledged war between Iran and Israel. The fall was also triggered by SEBI`s new F&O rules. The Nifty traded below the 25,250 mark. Private bank shares extended losses for the fourth trading session.

At 14:30 IST, the barometer index, the S&P BSE Sensex slumped 1,797.29 points or 2.31% to 82,469. The Nifty 50 index tumbled 552.10 points or 2.41% to 25,234.90.

In the broader market, the S&P BSE Mid-Cap index slipped 2.42% and the S&P BSE Small-Cap index declined 2.04%.

The market breadth was weak. On the BSE, 952 shares rose and 2,996 shares fell. A total of 104 shares were unchanged.

The NSE`s India VIX, a gauge of the market`s expectation of volatility over the near term, zoomed 9.57% to 13.14.

SEBI`s new F&O rules:

The Securities and Exchange Board of India`s (SEBI) introduced a six-step plan to curtail retail participation in speculative index derivatives. This could result in a significant decline in trading volumes. New regulations require traders to maintain higher margins, potentially hindering their ability to take on larger leveraged positions.

Moreover, the reduction of weekly options expiries to one per exchange could lead to decreased revenues for exchanges and brokers. This change means that each exchange will only offer weekly contracts for one benchmark index instead of the current two to four. These measures are designed to reduce excessive speculation in the futures and options (F&O) segment, where retail investors often find themselves on the losing end of trades.

Buzzing Index:

The Nifty Private Bank index fell 2.68% to 25,761.80. The index slipped 5.43% in four trading sessions.

Axis Bank (down 3.74%), Bandhan Bank (down 3.46%), Kotak Mahindra Bank (down 3.06%), HDFC Bank (down 2.45%), City Union Bank (down 2.39%), IDFC First Bank (down 2.3%), Federal Bank (down 2.29%), RBL Bank (down 2.14%), ICICI Bank (down 1.86%) and IndusInd Bank (down 1.6%) edged higher.

Numbers to Track:

The yield on India`s 10-year benchmark federal paper advanced 2.15% to 6.877 as compared with previous close 6.732.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 83.9625, compared with its close of 83.8275 during the previous trading session.

MCX Gold futures for 5 December 2024 settlement fell 0.66% to Rs 76,369.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, was up 0.15% to 101.82.

The United States 10-year bond yield added 0.59% to 3.810.

In the commodities market, Brent crude for November 2024 settlement added 86 cents or 1.16% to $74.76 a barrel.

Stocks in spotlight:

Marico rose 0.45%. The company informed that its domestic business posted mid-single digit volume growth, exhibiting improvement on a sequential basis.

REC slipped 3.21%. The company�s said that it has disbursed loans amounting to Rs 47,303 crore in Q2 FY24-25, which is higher by 13.71% as compared with Rs 41,598 crore disbursed in Q2 FY23-24.

NBCC (India) tumbled 4.65%. The company informed that it has received orders from Small Industrial Development Bank of India (SIDBI) and Ministry of Textiles, aggregating to Rs 47.04 crore.

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