Sensex, Nifty continue to trade in green in afternoon deals

Mirroring positive global cues, Indian equity benchmarks continued to trade in green in afternoon session, on the back of sustained buying by domestic institutional investors and retailers. Sentiments were optimistic  with report that India’s trade deficit narrowed more-than-expected to $12.96 billion in June as gold imports nearly halved from a month earlier. Some solace also came with the latest edition of the OECD’s economic outlook report on India, stating that economic growth is projected to remain strong and India will remain the fastest growing G20 economy. Moreover, the strengthening rupee against the dollar too buoyed the trading sentiments here. In scrip specific development, Shreyas Shipping & Logistics strengthened by around one and half percent after signing a Memorandum of Agreement for acquisition of one multipurpose vessel of about 1100 teus.

On the global front, Asian markets were trading mostly in green, following the gains on Wall Street Friday and as data showed that China's second-quarter GDP grew slightly more than expected. Back home, the BSE Sensex is currently trading at 32072.90, up by 52.15 points or 0.16% after trading in a range of 32053.98 and 32131.92. There were 21 stocks advancing against 10 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.17%, while Small cap index was up by 0.05%.

The top gaining sectoral indices on the BSE were IT up by 1.03%, Metal up by 0.91%, TECK up by 0.90%, Basic Materials up by 0.76% and Energy up by 0.52%, while FMCG down by 1.50%, PSU down by 0.11%, Capital Goods down by 0.09% and Healthcare down by 0.07% were the losing indices on BSE.

The top gainers on the Sensex were Wipro up by 3.55%, Mahindra & Mahindra up by 1.69%, Adani Ports & SEZ up by 1.67%, Reliance Industries up by 1.50% and Infosys up by 1.32%. On the flip side, ITC down by 2.65%, Coal India down by 0.84%, Hindustan Unilever down by 0.59%, Dr. Reddys Lab down by 0.59% and Axis Bank down by 0.57% were the top losers.

Meanwhile, the industry body, Associated Chambers of Commerce and Industry of India (Assocham) in its latest report has said that the Banking Regulation (Amendment) Ordinance has empowered the Reserve Bank of India (RBI) to take up the non-performing assets (NPAs) worth around Rs 8 lakh crore for faster resolution by March 2019. It also noted that the move has the potential to bring down the bad loans as well as significantly improve the financial health of banks. The report also highlighted that RBI would succeed in resolving non-performing assets (NPAs) worth around Rs 8 lakh crore by the first quarter of financial year 2019-20.

Assocham study titled 'NPAs Resolution: Light at the end of tunnel by March 2019' has indicated that this would be helped by a combination of several factors such as turnaround in the economic cycle and some resolute steps by the government and the RBI to fix the issue. The report also said that while all the NPAs could be put on the altar of Insolvency and Bankruptcy Code (IBC) resolution mechanism, it has to be seen how much and how fast they actually goes out from the balance sheets of banks. It further pointed out that it is no secret that NPAs are a big drain on the financial health of banks especially public sector banks (PSBs). 

Assocham Secretary General D S Rawat has stated that the 16-month Asset Quality Review (AQR) exercise that ended in March 2017 pulled out NPAs from the closet and after this deep surgery strong medicine was required to quickly heal the system. Therefore, he also said that somewhat bitter medicine came in the form of the Ordinance promulgated by the President in May. He added that the government gave wide-ranging legislative powers to the RBI to issue directions to lenders to initiate insolvency proceedings for the recovery of bad loans that have reached unacceptably high levels.

The CNX Nifty is currently trading at 9904.65, up by 18.30 points or 0.19% after trading in a range of 9894.70 and 9920.30. There were 31 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Wipro up by 3.06%, Vedanta up by 2.33%, Mahindra & Mahindra up by 1.78%, Adani Ports &SEZ up by 1.56% and Reliance Industries up by 1.39%. On the flip side, ITC down by 2.62%, Aurobindo Pharma down by 0.86%, Coal India down by 0.86%, Hindustan Unilever down by 0.66% and Sun Pharma down by 0.65% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 0.44 points or 0.03% to 1,755.44, Jakarta Composite surged 0.94 points or 0.02% to 5,832.74, KOSPI Index rose 10.47 points or 0.43% to 2,425.10, Taiwan Weighted was up by 13.63 points or 0.13% to 10,457.54 and Hang Seng added 79.96 points or 0.3% to 26,469.19.

On the flip side, Shanghai Composite was down by 52.37 points or 1.63% to 3,170.05.