Indian Indices End Marginally Lower; FMCG & IT Stocks Witness Losses

After opening the day on a positive note today, Indian share markets witnessed losses thereafter and ended their trading session marginally lower. Losses were largely seen in the FMCG sector and IT sector, while metal stocks ended the day higher.

At the closing bell, the BSE Sensex stood lower by 110 points (down 0.3%) and the NSE Nifty closed lower by 13 points (down 0.1%). The BSE Mid Cap index ended the day up by 0.4%, while the BSE Small Cap index ended the day up by 0.1%.

Asian stock markets finished in the green as of the most recent closing prices. The Hang Seng was up 1.1% and the Nikkei was trading up by 0.4%. The Shanghai Composite stood higher by 0.9%.

The rupee was trading at 72.61 to the US$ at the time of writing.

In the news from the finance sector, shares of IL&FS Group companies were trading on a positive note today after state-owned insurer Life Insurance Corporation of India (LIC) said it will not allow debt-ridden IL&FS to collapse and explore options to revive it.

The above announcement comes as earlier this month, it came to light that IL&FS group defaulted on a short-term loan of Rs 10 billion from SIDBI, while a subsidiary has also defaulted Rs 5 billion dues to the development finance institution.

While IL&FS has nearly Rs 350 billion consolidated debt, IL&FS Financial Services has Rs 170 billion of debt, which sits as standard asset for most of the lenders, the reports noted.

The group has seen its various long-term and short-term borrowing programmes downgraded to ‘default’ or ‘junk’ grades by credit rating agencies, even as the regulators are also probing alleged delay in disclosure about certain loan defaults.

According to Moody’s Investor Services, IL&FS’s outstanding debentures and commercial paper accounted for 1% and 2%, respectively, of India’s domestic corporate debt market as of 31 March 2018. Its bank loans made up about 0.5% to 0.7% of banking system loans.