Sensex, Nifty remain positive

Key Indian equity benchmarks remained positive in late afternoon session, with Sensex and Nifty holding gains of over 0.10%. Firm cues from European markets along with gains led by Metal, Auto and Basic Materials, provided support to the markets. Domestic sentiments were positive as Finance Commission Chairman N K Singh made a case for setting up a fiscal council as an institutional mechanism to monitor fiscal consolidation roadmap of the Centre and state governments. He also said fiscal federalism is a dynamic process and 'a Work in Motion'. The street took a note of the Vice President of India, M. Venkaiah Naidu’s statement that farmers were critical for the well-being of the nation and they play a huge role in ensuring and maintaining home grown food security in India. Further, the Vice President said that collective actions were needed to correct development strategies to include preservation of nature.

On the sectoral front, banking stocks were trading lower, even though credit rating agency Fitch Ratings in its latest report stated that non-performing loan (NPL) ratio of Indian banking sector improved during the first nine months of the current financial year, on the back of lower fresh slippages and better recoveries. As per the report, banking sector's NPL ratio decreased to 10.8% in 9MFY19 from 11.5% at fiscal year-end 2018. However, auto stocks were riding high, despite CRISIL’s report that the impact of muted demand is going to hit the revenue of final quarter (Q4) of the automobile industry hardest in the financial year 2019-2020. It is expected to be slowest in the last three fiscals to a marginal 1.8 percent. During the same quarter, industry saw a revenue growth of 7.3 per cent and 27 per cent in FY'17 and FY'18 respectively.

On the global front, European markets were trading in green, as Eurozone's M3 money supply annual growth improved in February after slowing in the previous month. The figures from the European Central Bank showed that M3, a measure of broad money supply, grew 4.3 percent year-on-year in February following a 3.8 percent increase in January. In December, M3 rose 4.1 percent. Asian markets were also trading in green, as investors digested a mixed bag of Japanese data. Retail sales dipped slightly in February from the previous month, while industrial output grew for the first time in four months and the jobless rate hit a nine-month low. Investors remained optimistic about the latest round of US-China trade talks.

The BSE Sensex is currently trading at 38597.30, up by 51.58 points or 0.13% after trading in a range of 38546.68 and 38748.54. There were 18 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.93%, while Small cap index was up by 0.50%.

The top gaining sectoral indices on the BSE were Metal up by 2.36%, Auto up by 1.57%, Basic Materials up by 1.46%, Healthcare up by 1.31% and Power up by 1.22%, while Consumer Durables down by 0.44% and Bankex down by 0.42% were the only losing indices on BSE.

The top gainers on the Sensex were Vedanta up by 3.06%, Tata Motors up by 2.96%, Tata Steel up by 2.84%, Maruti Suzuki up by 2.36% and Mahindra & Mahindra up by 2.09%. On the flip side, Indusind Bank down by 2.17%, Axis Bank down by 1.22%, Bajaj Auto down by 1.06%, ITC down by 1.03% and ICICI Bank was down by 0.64% were the top losers.

Meanwhile, bringing some relief, credit rating agency Fitch Ratings in its latest report has said that non-performing loan (NPL) ratio of Indian banking sector improved during the first nine months of the current financial year, on the back of lower fresh slippages and better recoveries. As per the report, banking sector's NPL ratio decreased to 10.8% in 9MFY19 from 11.5% at fiscal year end 2018.

However, the agency noted that provisioning pressures persisted with 14 out of 21 state-run banks reporting losses. It also said that mid-sized or small state-run banks were the most affected as credit costs, despite some moderation, exceeded their weak income buffers. Fitch further expects increasing pressure from farm loans due to a weak monsoon and loan waivers, and small and medium-sized enterprises (SMEs).

Besides, Fitch is expecting the banks to meet minimum capital norms, on the back of the government's February 2019 announcement to inject another $7 billion into its banks. But, it predicts that Indian banks will require an additional $23 billion by FY20 to sufficiently meet minimum Basel III capital standards, achieve 65% NPL cover and pursue low double-digit loan growth.

The CNX Nifty is currently trading at 11586.20, up by 16.20 points or 0.14% after trading in a range of 11570.15 and 11630.20. There were 31 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing Finance up by 3.60%, Vedanta up by 3.06%, Tata Motors up by 2.96%, Tata Steel up by 2.94% and Mahindra & Mahindra up by 2.34%. On the flip side, GAIL India down by 3.57%, Indusind Bank down by 2.13%, Bharti Infratel down by 1.56%, Bajaj Auto down by 1.33% and Titan was down by 1.25% were the top losers.

Asian market were trading mostly in green; Hang Seng increased 276.15 points or 0.96% to 29,051.36, Nikkei 225 surged 172.05 points or 0.82% to 21,205.81, Taiwan Weighted strengthened 104.78 points or 0.99% to 10,641.04, Shanghai Composite gained 93.40 points or 3.12% to 3,088.34, Straits Times advanced 14.83 points or 0.46% to 3,218.41 and KOSPI was up by12.57 points or 0.59% to 2,140.67. On the flip side, Jakarta Composite was down by 18.14 points or 0.28% to 6,462.65.

All European markets were trading in green; UK’s FTSE 100 gained 43.21 points or 0.60% to 7,277.54, France’s CAC rose 41.67 points or 0.79% to 5,338.21 and Germany’s DAX was up by 40.62 points or 0.36% to 11,468.78.