Local equities continue to trade in green trajectory

Local equity markets continued their trade with healthy gains in the morning trades, on account of buying in front line counters. The BSE Sensex eked out around half a percent gain, while the broader Nifty was trading over one third percent higher. Traders remained optimistic with a private report that Prime Minister Narendra Modi plans to unveil a long-awaited industrial policy soon to boost domestic manufacturing and accelerate economic growth before federal polls next year. Market-men also took some support from the Minister of State for Chemicals & Fertilisers report that approximately Rs 1.83 lakh crore has so far been invested in four Petroleum, Chemicals and Petrochemical Investment Regions (PCPIRs) being developed in Gujarat, Andhra Pradesh, Odisha and Tamil Nadu. These four regions generated employment to over three lakh people. Besides, the Reserve Bank of India (RBI) has relaxed norms for NBFCs to securitise their loan books, a move likely to ease the stress in the sector facing a crisis of confidence. Traders ignored a private report stating that India’s Gross Domestic Product (GDP) growth is expected to slow down to 7.4% in the July-September quarter of the current financial year, down by 0.8 percentage points from the previous quarter.

On the global front, Asian markets were trading mostly in green, looking to cap a full week of broad gains as investors hope that trade tensions will ease after a weekend meeting between the leaders of US and China. Back home, a private report stated that India has edged out China as the preferred partner for key European nations, Japan and the United Arab Emirates for joint infrastructure and capacity building projects in Africa.

The BSE Sensex is currently trading at 36347.39, up by 176.98 points or 0.49% after trading in a range of 36250.36 and 36389.22. There were 19 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.46%, while Small cap index was up by 0.49%.

The top gaining sectoral indices on the BSE were Realty up by 1.81%, IT up by 1.05%, Healthcare up by 1.02%, TECK up by 0.89% and Consumer Disc was up by 0.81% while, Metal down by 0.72%, Telecom down by 0.49%, Power down by 0.36%, PSU down by 0.23% and Basic Materials was down by 0.06% were the top losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 4.27%, Mahindra & Mahindra up by 2.51%, Wipro up by 2.17%, Maruti Suzuki up by 1.44% and Infosys was up by 1.33%. On the flip side, Tata Motors down by 2.28%, Tata Motors - DVR down by 2.19%, NTPC down by 1.51%, Vedanta down by 1.48% and Coal India was down by 1.09% were the top losers.

Meanwhile, in a bid to ease persistent stress in the non-banking financial company (NBFC) sector, the Reserve Bank of India (RBI) has relaxed rules for NBFCs to sell or securitise their loan books. The RBI stated that NBFCs can now securitise loans of more than five-year maturity after holding those for six months on their books. Earlier, they had to hold these assets for at least one year.

Though, it said that the relaxation on the minimum holding period will be allowed when the NBFC retains 20 percent of the book value of these loans.  NBFCs are facing stress on their balance sheets after a debt crisis hit a large infrastructure funding company in September, triggering panic amongst investors and a cash crunch in the sector.

Besides, the RBI and the government have taken many steps to ringfence the crisis and support financing needs of the sector, including providing additional liquidity to banks and credit enhancement for refinancing needs, following the massive volatility in the financial markets.

The CNX Nifty is currently trading at 10902.65, up by 43.95 points or 0.40% after trading in a range of 10882.45 and 10922.45. There were 31 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Yes Bank up by 3.99%, Mahindra & Mahindra up by 2.46%, Wipro up by 2.46%, Zee Entertainment up by 2.45% and Indiabulls Housing Finance was up by 1.56%. On the flip side, Bharti Infratel down by 2.34%, Tata Motors down by 2.31%, UPL down by 1.68%, NTPC down by 1.55% and Indian Oil Corporation was down by 1.33% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 161.25 points or 0.61% to 26,612.28, Nikkei 225 surged 97.65 points or 0.44% to 22,360.25, Taiwan Weighted strengthened 46.90 points or 0.47% to 9,932.26, Straits Times advanced 16.62 points or 0.53% to 3,126.06, Shanghai Composite was up by 5.97 points or 0.23% to 2,573.41.

On the other side, KOSPI fell 6.18 points or 0.29% to 2,107.92 and Jakarta Composite was down by 24.33 points or 0.4% to 6,082.84.