Indian Equities pare gains in early noon deals

Indian stock markets pared some of their gains in early noon deals, as traders turned little cautious with a report that Food inflation in the country is likely to go up to 2% in fiscal year 2019-20 from the 0.7% estimated for FY19. However, markets continued to trade in green terrain, as some support came with a report stating that India's share in the final consumption of consumer goods is expected to double by 2030 and the favourable demographics will soon take it ahead of China in regional market dynamics. The sentiment also remained positive with finance ministry’s statement that liquidity situation in the economy was ‘comfortable’, and it will improve further with the central bank’s move to infuse Rs 35,000 crore through the rupee-dollar swap arrangement.

Global cues too remained positive as Asian markets were mostly trading in green a day after a regional sell-off sparked by fresh worries of a coming US recession. Back home, buying witnessed largely in Realty sector followed by Utilities and Energy. On scrip specific developments, Tata Steel gained on acquiring 8.89% OCRPS of Tata Steel BSL and NHPC edged higher on starting trading of power for J&K.

The BSE Sensex is currently trading at 37888.77, up by 79.86 points or 0.21% after trading in a range of 37814.54 and 37962.75. There were 21 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained by 0.51%, while Small cap index was up by 0.36%.

The top gaining sectoral indices on the BSE were Realty up by 2.13%, Utilities up by 1.20%, Energy up by 1.11%, Power up by 0.99% and PSU was up by 0.93%, while IT down by 1.09%, TECK down by 0.90%, Auto down by 0.11% and Consumer Durables was down by 0.05% were the few losing indices on BSE.

The top gainers on the Sensex were Vedanta up by 2.11%, Asian Paints up by 1.75%, Bajaj Finance up by 1.68%, Reliance Industries up by 1.60% and SBI was up by 1.48%. On the flip side, Infosys down by 1.81%, TCS down by 0.99%, Hero MotoCorp down by 0.80%, ITC down by 0.76% and HDFC was down by 0.61% were the top losers.

Meanwhile, in order to promote innovation in FinTech space, Reserve Bank of India (RBI) Governor Shaktikanta Das has said the central bank will issue guidelines for setting up a regulatory sandbox or innovation hub for the fintech startups in the next two months. He noted that a regulatory sandbox will help FinTech firms to launch innovative products at a lower cost and in less time. He also explained that a regulatory sandbox is a framework set up by a regulator that allows FinTech startups to conduct live experiments in a controlled environment under supervision.

Observing that FinTech has the potential to reshape the financial services and financial inclusion landscape in India in fundamental ways, Das said that it can reduce costs and improve access and quality of financial services. He also said “we have to strike a subtle balance between effectively utilising FinTech while minimising its systemic impacts.” He stated that the RBI has encouraged banks to explore the possibility of establishing new alliances with FinTech firms as it could be pivotal in accelerating the agenda of financial inclusion through innovation. Adding further, he said that it is essential that flow of investments to this sector is unimpeded to realise its full potential. He also said that it is imperative to create an ecosystem which promotes collaboration while carefully paying attention to the implications that it has for the macro economy.

Pointing out some of the challenges, the RBI governor said that risks for FinTech products may also arise from cross border legal and regulatory issues. He also said that data confidentiality and customer protection are major areas that also need to be addressed. Emphasizing that India has been at the forefront of this revolution, he said, a recent global survey ranks India second in terms of FinTech adoption, with an adoption rate of 52 percent. He added that there are as many as 1,218 FinTech firms operating in India which have created a large number of jobs and have generated a healthy appetite for investment.

The CNX Nifty is currently trading at 11377.50, up by 23.25 points or 0.20% after trading in a range of 11363.50 and 11402.95. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing up by 2.33%, GAIL India up by 2.32%, Vedanta up by 2.14%, Bajaj Finance up by 2.01% and Asian Paints was up by 1.76%. On the flip side, Tech Mahindra down by 2.01%, Infosys down by 1.80%, BPCL down by 1.75%, UPL down by 1.64% and TCS was down by 0.92% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 422.39 points or 2.01% to 21,399.50, Taiwan Weighted strengthened 79.72 points or 0.76% to 10,559.20, Jakarta Composite soared 57.58 points or 0.9% to 6,468.83, Straits Times gained 22.74 points or 0.71% to 3,205.66 and KOSPI was up by 6.05 points or 0.28% to 2,150.91

On the flip side, Shanghai Composite decreased 23.50 points or 0.77% to 3,019.53 and Hang Seng was down by 25.67 points or 0.09% to 28,497.68.