Markets continue to trade in green terrain

Following firm Asian cues, local equity benchmarks continued their trade in positive territory in morning session, on heavy buying in oil & gas and capital goods stocks. Also, strength in rupee against the dollar boosted the domestic sentiment. The top gainers were ONGC, Bajaj Auto and HDFC Bank, while the major losers were Bharti Airtel, Tata Steel and Vedanta. Traders took encouragement from IMF’s statement that India’s growth remains ‘quite robust’ into the future, despite slightly downgrading the country's growth projection for 2018-19 due to high oil prices and a tight monetary policy regime. Traders also remained optimistic with a report that GDP growth at 7.5% plus was a very healthy and positive sign for Indian economy, noting that impact of sustained structural reforms is now being felt on the ground. Traders took note of a private report that Indian metal companies should report strong 1Q results. Steel companies should benefit from the full impact of 4Q price hikes, though volume may be lower Quarter on Quarter.

On the global front, Asian markets were trading in green, tracking a Wall Street rally after the head of the Federal Reserve expressed confidence in the US economy despite fears of a global trade war. Federal Reserve chief Jerome Powell offered a positive outlook citing a strong job market and inflation figures in line with Fed targets, sending US stocks higher. Back home, in scrip specific development, Kridhan Infra gained over 8% with associate company bagging new project worth Rs 222.60 crore. Besides, Mahindra & Mahindra Financial Services surged on getting nod to invest Rs 4 crore in AAPCA Demystifying Data Technologies.

The BSE Sensex is currently trading at 36652.33, up by 132.37 points or 0.36% after trading in a range of 36584.56 and 36747.87. There were 19 stocks advancing against 12 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index slipped 0.27%, while Small cap index was up by 0.22%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.27%, Capital Goods up by 0.96%, Energy up by 0.70%, Consumer Durables up by 0.57% and IT was up by 0.23%, while Metal down by 1.15%, Telecom down by 1.04%, Realty down by 0.45%, Basic Materials down by 0.42% and Power was down by 0.19% were the top losing indices on BSE.

The top gainers on the Sensex were ONGC up by 2.59%, Bajaj Auto up by 1.64%, HDFC Bank up by 1.58%, Sun Pharma up by 1.24% and Adani Ports & SEZ was up by 1.09%. On the flip side, Tata Steel down by 1.60%, Bharti Airtel down by 1.46%, Vedanta down by 1.21%, Hindustan Unilever down by 0.97% and Mahindra & Mahindra was down by 0.88% were the top losers.

Meanwhile, in order to help the public sector banks (PSBs) to make interest payments due on some bonds, the Finance Ministry has decided to provide capital to 4-5 banks which are facing ‘acute shortage’. The Ministry may infuse about Rs 10,000 crore within a few days in some state-owned lenders including PNB, Corporation Bank and Central Bank of India. Some of these banks have come under pressure because of interest payment to their bond holders of Additional Tier 1 (AT-1) bonds. Accordingly, they are facing the risk of breaching the regulatory capital requirement.

The infusion will be part of remaining Rs 65,000 crore out of Rs 2.11 lakh crore capital infusion over two financial years. The new round of infusion will be between Rs 8,000 and Rs 10,000 crore.  In October last year, the government had announced Rs 2.11 lakh crore capital infusion programme. As per the plan, the PSBs were to get Rs 1.35 lakh crore through re-capitalisation bonds, and the balance Rs 58,000 crore through raising of capital from the market.

Out of the Rs 1.35 lakh crore, the government has already infused about Rs 71,000 crore through recap bonds in the banks and balance would be done during this fiscal. Out of 21 public sector banks, 13 have already taken the approval of their boards or shareholders for raising capital through the equity market, the combined value of the shares sales of these banks is upwards of Rs 50,000 crore. Capital is very much required for these banks as they are saddled with non-performing assets (NPAs) or bad loans of about Rs 10 lakh crore.

The CNX Nifty is currently trading at 11055.50, up by 47.45 points or 0.43% after trading in a range of 11033.80 and 11076.20. There were 31 stocks advancing against 18 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Indiabulls Housing Finance up by 3.68%, ONGC up by 2.59%, Bajaj Finance up by 1.84%, Eicher Motors up by 1.73% and HDFC Bank was up by 1.67%. On the flip side, Lupin down by 2.33%, Hindalco down by 1.87%, UPL down by 1.73%, Tata Steel down by 1.71% and Bharti Airtel was down by 1.46% were the top losers.

Asian markets were trading in green; Taiwan Weighted surged 18.05 points or 0.17% to 10,797.04, Jakarta Composite strengthened 19.73 points or 0.34% to 5,881.24, Hang Seng gained 78.04 points or 0.28% to 28,259.72, KOSPI rose 2.23 points or 0.10% to 2,300.15, Shanghai Composite soared 14.21 points or 0.51% to 2,812.34, Straits Times advanced 11.36 points or 0.35% to 3,251.00 and Nikkei 225 was up by 153.34 points or 0.67% to 22,850.70.