Benchmarks continue their northward journey in late afternoon session

Indian equity benchmarks continued their northward journey in late afternoon session with a gain of over half a per cent each despite mixed global cues. Some support came with the report that Exports of goods continued to rise for the fifth straight month though at a slightly slower pace at 4.32 per cent to $22.11 billion in January, led by higher shipments of petroleum products, engineering goods and iron ore. Imports also rose, by 10.70 percent to $ 31.95 billion, during the month under review. On sectoral front, stocks from IT, TECK and Consumer Durables sectors were attracting buyers, whereas stocks from FMCG sections were trading weak. On the global front, European markets were trading in mixed as investors took profit amid expectations that the Federal Reserve could raise interest rates more aggressively than expected following upbeat U.S. economic data. Asian markets were trading in red. Back home, in scrip specific development, NIIT Technologies was trading in green after the company entered into partnership with Nanoheal, a predictive tech support and IT helpdesk platform.

The BSE Sensex is currently trading at 28298.68, up by 143.12 points or 0.51% after trading in a range of 28146.19 and 28327.75. There were 20 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.64%, while Small cap index was up by 1.11%.

The top gaining sectoral indices on the BSE were Realty up by 2.15%, IT up by 1.89%, TECK up by 1.46%, Consumer Durables up by 1.31% and Auto up by 1.12%, while FMCG down by 0.66% were the sole losing index on BSE.

The top gainers on the Sensex were Sun Pharma up by 3.50%, Infosys up by 2.81%, Maruti Suzuki up by 2.30%, GAIL India up by 1.92% and Tata Motors up by 1.56%. On the flip side, ITC down by 1.61%, Adani Ports & Special economic zone down by 1.13%, Asian Paints down by 0.90%, Coal India down by 0.72% and Larsen & Toubro down by 0.68% were the top losers.

Meanwhile, credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has maintained stable outlook on large public sector banks and private sector banks supported by high levels of capital. On the same time it retained its negative outlook on mid-sized and smaller state-run banks due to limited access to capital and large non-performing assets.

Ind-Ra in its report ‘Indian Banks Outlook for FY18’ said that there is an increasing divide between the large and smaller PSBs, with the former having some access to growth capital, better market valuation, and also some non-core assets to divest while the latter would only receive bailout capital if required and would need to ration their capital consumption over next two years.

It said that while the large public sector banks with better access to capital and private sector banks with their robust capitalisation will navigate another year of low growth and high credit costs with a stable outlook, mid-sized and smaller state-run banks will find it increasingly difficult to grow given increasing capital requirements and large funding gaps impeding their ability to compete on spreads.

The rating agency however said that long term ratings of all public sector banks remain resilient on expectations of continued government support. The report also said that Indian banks will need Rs 91,000 crore in Tier-I capital until March 2019 to grow at a bare minimum pace of 8 to 9 per cent compound annual growth rate (CAGR)  ) including a residual Rs 20,000 crore from the government’s bank recapitalisation programme 'Indradhanush'. Impaired assets in the banking sector are expected to peak at 12.5 per cent to 13 per cent by the financial year 2017-18 and 2018-19, which is likely to be at 12% by the end of financial year 2016-17. The rating agency also maintained a stable outlook on the non-bank finance company (NBFC) sector and on the major NBFCs rated by it for the financial year 2017-18.

The CNX Nifty is currently trading at 8770.85, up by 46.15 points or 0.53% after trading in a range of 8719.60 and 8781.15. There were 32 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Sun Pharma up by 3.43%, Infosys up by 2.94%, Maruti Suzuki up by 2.31%, GAIL India up by 1.93% and Bank of Baroda up by 1.78%. On the flip side, ITC down by 1.66%, Bharti Infratel down by 1.51%, Adani Ports & Special economic zone down by 1.25%, Bosch down by 1.00% and Asian Paints down by 0.92% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 decreased 90.45 points or 0.47% to 19,347.53, Taiwan Weighted decreased 28.51 points or 0.29% to 9,771.25, Jakarta Composite decreased 13.26 points or 0.25% to 5,367.41, FTSE Bursa Malaysia KLCI decreased 2.2 points or 0.13% to 1,707.59 and KOSPI Index decreased 2.02 points or 0.1% to 2,081.84. On the flip side, Shanghai Composite increased 16.63 points or 0.52% to 3,229.62 and Hang Seng increased 112.83 points or 0.47% to 24,107.70.

European markets were trading mixed; UK’s FTSE 100 decreased 8.55 points or 0.12% to 7,293.86 and France’s CAC decreased 4.33 points or 0.09% to 4,920.53. On the flip side, Germany’s DAX increased 9.49 points or 0.08% to 11,803.42.