Markets trade near fresh all time high supported by realty, consumer discretionary

Markets continuing their steady trade are at their fresh lifetime high, with both the benchmarks adding another over a quarter percent in the morning deals. Traders are getting support from the positive trade in the regional markets, while the euphoria of good monsoon was still playing its part on domestic front with hopes of higher agricultural and economic growth after the IMD’s rain forecast, keeping the spirit high for the markets. IMD said that the prospects of the monsoon have brightened due to reduced chances of El-Nino. It said that the recent development on El-Nino indicates that the monsoon could be normal this year. Meanwhile, the Asian markets overlooking the sluggish trend in the US markets have moved higher, with the surge in the international crude oil prices. While most of the sectoral indices are in green, there is some somberness in the power sector, as Piyush Goyal, Minister of State (Independent Charge) of Power, Coal, New & Renewable Energy, and Mines said that we won’t see a completely deregulated power market in the near future, unless some States go in for a Direct Benefit Transfer of subsidy. Though, he dismissed any suspicion about Ujjwal Discom Assurance Yojana or UDAY hitting a roadblock.

In scrip specific development, Bharti Airtel just after a day of huge surge, was trading down by over a percent. The company despite a 72 per cent decline in net profit for the March quarter, was committing a capital expenditure of $3 billion (Rs 19,300 crore) this financial year, of which $500 million would be spent in Africa, which became profitable in the passing quarter.

The BSE Sensex is currently trading at 30350.68, up by 102.51 points or 0.34% after trading in a range of 30296.32 and 30366.43. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were even in better position than the benchmarks; the BSE Mid cap index was up by 0.51%, while Small cap index gained 0.53%.

The top gaining sectoral indices on the BSE were Consumer Disc up by 1.07%, Realty up by 1.01%, Auto up by 0.91%, Metal up by 0.77%, Consumer Durables up by 0.76%, while Telecom down by 0.86%, Power down by 0.56%, Utilities down by 0.25%, Capital Goods down by 0.09% were the losing indices on BSE.

The top gainers on the Sensex were Bajaj Auto up by 2.19%, Hero MotoCorp up by 2.09%, ITC up by 1.46%, Axis Bank up by 1.23% and ONGC up by 1.01%. On the flip side, Bharti Airtel down by 1.40%, GAIL India down by 0.84%, Dr. Reddy’s Lab down by 0.62%, Hindustan Unilever down by 0.59% and NTPC down by 0.37% were the top losers.

Meanwhile, credit growth of banks dropped to 4.32% in the fortnight to April 28. This is much lower than the 63-year low level of 5.08% in the financial year 2016-17. As per the Reserve Bank of India data, in the reporting fortnight, credit growth of banks crashed down to Rs 7,545 crore as compared to Rs 7,232 crore last year.

For the fiscal ended March 2017, credit growth had plunged to a multi-decadal low of 5.08% with outstanding loans at Rs 7,881 crore as compared to Rs 7,501 crore on April 1, 2016. The credit growth in the financial year 2016-17 is the lowest since 1953-54 when it had inched up by a paltry 1.7%.

However, loan growth had slightly increased to 5.52% in the fortnight to April 14 to Rs 7631 crore. Even then the cumulative growth for the first month of the new financial year is only 5.3%. Low credit growth is mainly due to high bad debt and weak corporate demand and also due to increasing use of debt from corporate bond markets, where the rate of interest is much cheaper than what banks are offering.

For the reported fortnight, growth of bank deposits also slowed 10.33% to Rs 10,509 crore as compared to Rs 9,525 crore in the fortnight ended April 29, 2016. In the previous fortnight, bank deposits had grown by 11.59% to Rs 10,591 crore due to the large flow of funds into the banking system after the note-ban last November.

The CNX Nifty is currently trading at 9446.90, up by 39.60 points or 0.42% after trading in a range of 9426.65 and 9450.65. There were 35 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Zee Entertainment up by 4.27%, Eicher Motors up by 3.39%, Hindalco up by 3.21%, Hero MotoCorp up by 2.02% and Bajaj Auto up by 1.96%. On the flip side, Bharti Airtel down by 1.41%, GAIL India down by 0.96%, Dr. Reddy’s Lab down by 0.78%, Hindustan Unilever down by 0.63% and Power Grid Corporation down by 0.48% were the top losers.

Most of the Asian markets were trading in green, FTSE Bursa Malaysia KLCI was up by 11.47 points or 0.65% to 1,778.03, Taiwan Weighted was higher by 16.51 points or 0.17% to 9,984.83, KOSPI Index gained 19.19 points or 0.85% to 2,289.31, Hang Seng was higher by 61.97 points or 0.25% to 25,077.39 and Nikkei 225 gained 67.4 points or 0.34% to 19,967.49.

On the other hand, Shanghai Composite was lower by 20.72 points or 0.68% to 3,032.06.