Benchmarks trade comfortably in green despite losing some strength

Indian markets continued their steady trade towards mid of the session despite losing some early gains, with benchmarks comfortably holding their gains and trading at fresh record highs. While the Nifty was trading past 9130 mark, Sensex was well above 29500. The local markets are getting support from the good going in the regional peers after the US Fed hiked interest rates, as expected, but signaled only gradual tightening, soothing emerging market investors who had feared faster rate hikes. Also, there are reports that domestic as well as foreign institutional investors have increased their bet in the local market after the state election result verdict. Domestic traders were also getting supported with India's exports exhibiting a double digit growth of 17.48 percent, valued at $ 24.5 billion in February compared to $ 20.84 billion during the same month last year.

While all the sectoral indices are trading in green at this point of time, metal and basic materials have taken the lead. Banking pack though was trading in green but have given up much of their gains despite Finance Minister stating that the rate of rise in bank's non- performing assets has slowed down in the March quarter and the steel sector has started showing signs of improvement. He said that to deal with the NPAs of the banks is a challenging task even though the NPAs have shown a declining trend in the last quarter of the current financial year.

The BSE Sensex is currently trading at 29516.06, up by 117.95 points or 0.40% after trading in a range of 29482.83 and 29614.79. There were 23 stocks advancing against 6 stocks declining on the index, while one stock remained unchanged.

The broader indices too were trading in green; the BSE Mid cap index was up by 0.94%, while Small cap index up by 0.90%.

The top gaining sectoral indices on the BSE were Metal up by 1.94%, Basic Materials up by 1.27%, Industrials up by 1.22%, Consumer Durables up by 1.10% and Power up by 1.10%.

The top gainers on the Sensex were Adani Ports & SEZ up by 3.74%, Tata Steel up by 2.87%, Asian Paints up by 1.64%, Infosys up by 1.23% and GAIL India up by 1.13%. On the flip side, Hero MotoCorp down by 0.86%, ICICI Bank down by 0.75%, Bharti Airtel down by 0.63%, SBI down by 0.40% and Bajaj Auto down by 0.15% were the top losers.

Meanwhile, in order to deal with the problem of rising Non-Performing Assets (NPAs), the finance Minister Arun Jaitley has said that government is taking various sectoral specific measures for the resolution of large debts and would consider setting up multiple oversight committees under the Reserve Bank of India (RBI) to examine the cases of NPAs referred by banks. The ministry though added that the resolution of banks’ NPAs remained a challenge even though the rate of increase of such bad loans had witnessed slowdown in the last quarter of the current financial year.

Jaitley said the RBI has already set up an Oversight Committee to look into process of the cases referred to it by the different banks and pointed out that the core problem of NPAs is with very large corporates, predominantly in the steel, power, infrastructure and textile sectors and noted that the Steel Sector is on its path of recovery, while many decisions have been taken in the Infrastructure, power and textile Sectors to resolve their problems. Besides, he said that the NPAs surged during the boom period of 2003-2008 but could not face the onslaught of global financial crisis and consequent slow down thereafter.

The gross NPAs of public sector banks have risen from Rs 5.02 lakh crore at the end of March 2016 to Rs 6.06 lakh crore in December 2016. The members of Consultative Committee gave various suggestions in order to deal with the NPAs of PSBs. The RBI too has taken measures such as formation of Joint Lenders’ Forum (JLF) mandatory when aggregate exposure is more than Rs 100 crore, Flexible Structuring (5/25) Scheme for infrastructure.

The CNX Nifty is currently trading at 9132.60, up by 47.80 points or 0.53% after trading in a range of 9128.55 and 9152.90. There were 42 stocks advancing against 9 stocks declining on the index.

The top gainers on Nifty were Adani Ports & SEZ up by 3.72%, Tata Steel up by 2.73%, Hindalco up by 2.25%, Indusind Bank up by 2.19% and Asian Paints up by 1.66%. On the flip side, Bharti Airtel down by 0.94%, Hero MotoCorp down by 0.77%, ICICI Bank down by 0.75%, SBI down by 0.41% and Bajaj Auto down by 0.25% were the top losers.

All the Asian markets were trading in green, Nikkei 225 was up by 12.76 points or 0.07% to 19,590.14, FTSE Bursa Malaysia KLCI increased by 15.27 points or 0.89% to 1,732.63, KOSPI Index gained 15.76 points or 0.74% to 2,148.76, Shanghai Composite was higher by 24.27 points or 0.75% to 3,266.03, Jakarta Composite surged by 53.68 points or 0.99% to 5,486.06, Taiwan Weighted added 97.52 points or 1% to 9,837.83 and Hang Seng zoomed by 338.49 points or 1.42% to 24,131.34.