Domestic bourses maintain gaining momentum in early noon deals

Indian stock markets continued to trade in positive terrain in early noon session with Sensex and Nifty trading above 39,250 and 11,700 levels respectively. Buying in frontline stocks such as Yes Bank, Indusind Bank and Bajaj Auto were aiding sentiment, while selling in TCS, Axis Bank and ITC kept the gains in the markets in check. Besides, broader indices were also trading in green, supporting their larger peers. Investors took support with the Economic Advisory Council to the Prime Minister (EAC-PM) has rejected the claims of former CEA Arvind Subramanian regarding over-estimation of GDP growth after 2011, saying his analysis ignores data on services and agriculture and shows blind trust in a private firm CMIE. Some comfort also came with Commerce and Industry Minister Piyush Goyals’ statement that the government will not allow foreign companies to operate in multi-brand segment and necessary action will be taken against people indulging in predatory pricing. However, gains remain capped as DBS Bank has revised India's GDP growth for fiscal year 2020 downwards to 6.8 per cent year-on-year (YoY) from 7 per cent projected earlier, citing headwinds for exports amidst challenging trade outlook.

On the global front, Asian markets were trading mostly in green, as Federal Reserve head Jerome Powell said the central bank wanted to sustain the economic expansion amid greater uncertainty arising from trade wars. Back on home turf, on the sectoral front, pharma stocks were in limelight as Indian Pharmaceutical Alliance (IPA) has said that the pharmaceutical sector in the country is aiming to grow to the size of $120-130 billion by the year 2030 from the existing $38 billion.

The BSE Sensex is currently trading at 39277.09, up by 164.35 points or 0.42% after trading in a range of 38933.78 and 39306.63. There were 24 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.65%, while Small cap index was up by 0.34%.

The top gaining sectoral indices on the BSE were Realty up by 1.26%, Telecom up by 1.24%, Healthcare up by 1.06%, Consumer Durables up by 1.01% and Oil & Gas was up by 0.84%, while IT down by 0.51%, TECK down by 0.27% and FMCG was down by 0.27% were the few losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 4.99%, Indusind Bank up by 2.97%, Bajaj Auto up by 1.86%, Sun Pharma up by 1.80% and Bharti Airtel was up by 1.48%. On the flip side, TCS down by 0.63%, Axis Bank down by 0.59%, ITC down by 0.45%, Hindustan Unilever down by 0.44% and Infosys was down by 0.28% were the top losers.

Meanwhile, the rating agency ICRA in its latest report has said that operational creditors account for nearly half of the bankruptcy cases admitted at the National Company Law Tribunals (NCLTs) and the haircuts in resolutions taken by them are at par with the same taken by financial creditors. It also said that the operational creditors -- vendors and companies who have dues from a distressed company -- are assumed to be unsecured creditors, unlike the secured financial creditors like banks.

According to the report, the operational creditors have been successful in maintaining their ratio of payouts because of an eye on maintaining relationships by the successful bidders in resolutions processes. It found that of the 92 insolvency resolutions, operational creditors would realise about 42 percent of the total claims and financial creditors would realise 44 percent of the total claims. It believed that the reason the operational creditors have not suffered significantly higher haircuts is on account of the criticality of certain creditors to the core operations of the corporate debtors. As a result, it said the resolution applicants have ensured that relationships with such creditors are maintained.

ICRA further said that the ability to take a company to the NCLTs is one of the biggest successes of the introduction of the IBC (Insolvency and Bankruptcy Code) and such creditors are using the provision proactively and effectively. It noted that of the 1,858 corporate debtors referred to the NCLT upto March 31, 920 or 49 percent cases have been referred by the operational creditors.

The CNX Nifty is currently trading at 11724.60, up by 33.15 points or 0.28% after trading in a range of 11635.05 and 11745.95. There were 31 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing up by 4.75%, Yes Bank up by 4.55%, Indusind Bank up by 3.01%, Sun Pharma up by 1.88% and Bajaj Auto was up by 1.56%. On the flip side, UPL down by 6.92%, Wipro down by 2.57%, Tech Mahindra down by 1.77%, Britannia down by 1.68% and Axis Bank was down by 0.88% were the top losers.

Asian markets were trading mostly in green; KOSPI rose 4.75 points or 0.22% to 2,129.53, Straits Times advanced 28.28 points or 0.86% to 3,316.45, Hang Seng increased 265.46 points or 0.94% to 28,467.60, Taiwan Weighted strengthened 16.91 points or 0.16% to 10,792.25, Nikkei 225 surged 140.34 points or 0.66% to 21,474.21 and Shanghai Composite was up by 58.17 points or 1.99% to 2,975.97. On the flip side, Jakarta Composite was down by 7.82 points or 0.12% to 6,331.44.