Markets trade near day’s high

Indian equity benchmarks extended their gains in late afternoon session to reach near their intraday high points, despite weak opening in European markets. ONGC gained the most among major industry leaders on the BSE in noon deals. Traders got encouraged as the Reserve Bank of India decided to infuse more liquidity into market. It will buy government securities under Open market operations (OMOs) for an aggregate amount of Rs 25,000 crore in May 2019 through two auctions of Rs 12,500 crore each. On the sectoral front, stocks related to the microfinance industry remained in focus, with ICRA’s latest report stating that the microfinance industry (MFI) is expected to grow at 20-22% in the current fiscal. The rating agency estimated Rs 3,500-4,700 crore of capital requirement for the industry over the next three years.

On the global front, European markets were trading in red, as Germany's business confidence unexpectedly weakened in April to its lowest level in three years. The survey data from the ifo Institute showed that the ifo business climate indicator dropped to 99.2 from an upwardly revised 99.7 in March. The latest reading was the lowest since April 2016, when the score was 99. Asian markets were also trading in red.

The BSE Sensex is currently trading at 38906.87, up by 341.99 points or 0.89% after trading in a range of 38571.00 and 38909.92. There were 21 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.25%, while Small cap index was up by 0.30%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 2.14%, Energy up by 1.60%, Telecom up by 1.41%, TECK up by 1.15% and IT up by 1.06%, while Auto down by 0.36% and Power down by 0.11% were the only losing indices on BSE.

The top gainers on the Sensex were ONGC up by 2.87%, HCL Tech. up by 2.81%, Bharti Airtel up by 2.62%, Indusind Bank up by 2.34% and Yes Bank up by 2.13%. On the flip side, Tata Motors - DVR down by 3.41%, Tata Motors down by 3.00%, Vedanta down by 0.69%, Hero MotoCorp down by 0.63% and Axis Bank down by 0.59% were the top losers.

Meanwhile, highlighting good growth prospects, credit rating agency, ICRA in its latest report has said that the microfinance industry (MFI) is expected to grow at 20-22% in the current fiscal. The rating agency estimated Rs 3,500-4,700 crore of capital requirement for the industry over the next three years.

According to the report, the asset quality indicators of the microfinance industry should be supported by ensuring stringent group selection/elimination norms and adequate credit discipline at the borrower level. Further, it said that the segment remains vulnerable to income shocks, political interference, and event risks and the credit costs for the sector are likely to remain volatile with a mean level of 1.5-2 percent annualized.

Besides, the rating agency said that investors continued to support the MFI with equity infusion of around Rs 4,350 crore in FY19 as against Rs 4,100 crore in FY18. It said that more than 90% of the capital raised in the last fiscal was by the MFI with assets under management (AUMs) of greater than Rs 1,000 crore. This implies that larger entities have been able to attract capital, while the smaller less-diversified entities continue to struggle on this front.

The CNX Nifty is currently trading at 11684.65, up by 108.70 points or 0.94% after trading in a range of 11578.85 and 11685.30. There were 38 stocks advancing against 10 stocks declining, while 2 stocks remained unchanged on the index.

The top gainers on Nifty were BPCL up by 3.85%, Ultratech Cement up by 3.57%, ONGC up by 3.08%, HCL Tech up by 2.91% and Indian Oil Corporation up by 2.88%. On the flip side, Tata Motors down by 3.17%, Vedanta down by 0.74%, Hero MotoCorp down by 0.74%, Coal India down by 0.59% and Power Grid down by 0.52% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 157.41 points or 0.53% to 29,805.83, Nikkei 225 slipped 59.74 points or 0.27% to 22,200.00, KOSPI fell 19.48 points or 0.88% to 2,201.03, Jakarta Composite dropped 14.12 points or 0.22% to 6,448.70 and Shanghai Composite was down by10.18 points or 0.32% to 3,188.41. On the flip side, Taiwan Weighted gained 1.96 points or 0.02% to 11,027.64 and Straits Times was up by 6.78 points or 0.2% to 3,360.25.

European markets were trading mostly in red; Germany’s DAX gained 42.77 points or 0.35% to 12,278.28, while UK’s FTSE 100 slipped 31.30 points or 0.42% to 7,491.77 and France’s CAC was down by 10.59 points or 0.19% to 5,581.10.