Key indices add gains amid firm global cues

Indian equity markets extended their gains in afternoon session on fresh buying by investors, amid a firm trend in Asian markets. Sentiments on the street improved further with private report stating that private equity investments in the country are expected to grow 15-20 per cent in 2020 as investors pin hopes on the country's long growth potential after a blockbuster year when credit flow through regular channels turned slow. Local investors also cheered with the commerce and industry ministry’s latest data showing that foreign direct investment (FDI) into India grew 15% to $26 billion during the first half of the current financial year (H1FY20) as compared to $22.66 billion during April-September of 2018-19, despite a slowdown in the global economy. On the sectoral front, shares of broadcasting and cable TV operators such as Sun TV Network and Zee Entertainment Enterprises fell after TRAI made amendments to the new regulatory framework for cable and broadcasting services under which cable TV users will be able to access more channels at lower subscription price.

On the global front, Asian markets were trading mostly in green, spurred by Chinese markets after Beijing eased monetary policy to support the slowing economy. Investors also cheered news that the United States and China will sign a trade pact soon after months of volatile negotiations between the world's two largest economies. Back home, the BSE Sensex is currently trading at 41557.80, up by 251.78 points or 0.61% after trading in a range of 41328.45 and 41557.99. There were 24 stocks advancing against 5 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.79%, while Small cap index was up by 1.26%.

The top gaining sectoral indices on the BSE were Basic Materials up by 2.46%, Metal up by 2.05%, Industrials up by 1.51%, Capital Goods up by 1.50% and Energy up by 1.07%, while Consumer Durables down by 0.03% and TECK down by 0.02% were the only losing indices on BSE.

The top gainers on the Sensex were Ultratech Cement up by 3.83%, Tata Steel up by 2.98%, Larsen & Toubro up by 2.05%, Bajaj Finance up by 1.36% and Sun Pharma up by 1.36%. On the flip side, Bajaj Auto down by 0.64%, TCS down by 0.47%, Power Grid down by 0.33%, Kotak Mahindra Bank down by 0.23% and Nestle down by 0.03% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) has extended existing relaxations for securitization of assets by non-banking financial companies (NBFCs) till June 30, 2020.  The move is expected to provide NBFCs with some more breathing space to repair their broken balance-sheets by selling assets and improving liquidity.

In November 2018, the RBI had first relaxed the minimum holding period (MHP) requirement for originating NBFCs, for loans of maturity above five years, to six months from 12 months earlier. The relaxation was originally given for six months till May 2019. The central bank then extended this relaxation till December 31, 2019. The minimum holding period is the duration for which an NBFC is required to hold the loans on its book before selling them.

These relaxations were allowed after a liquidity crisis emerged in the non-bank space in the wake of the collapse of the Infrastructure Leasing & Financial Services (IL&FS) group in 2018. So much so that NBFCs and their mortgage lending peers relied largely on securitisation deals to raise funds.

The CNX Nifty is currently trading at 12260.60, up by 78.10 points or 0.64% after trading in a range of 12195.25 and 12262.15. There were 39 stocks advancing against 10 stocks declining on the index.

The top gainers on Nifty were Ultratech Cement up by 3.84%, Tata Motors up by 3.06%, Tata Steel up by 2.95%, JSW Steel up by 2.74% and Vedanta up by 2.46%. On the flip side, Eicher Motors down by 2.07%, Zee Entertainment down by 0.97%, Bajaj Auto down by 0.77%, BPCL down by 0.54% and Power Grid down by 0.38% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 308.95 points or 1.1% to 28,498.70, Taiwan Weighted strengthened 103.34 points or 0.86% to 12,100.48, Shanghai Composite gained 37.50 points or 1.23% to 3,087.62 and Straits Times advanced 22.03 points or 0.68% to 3,244.86.

On the flip side, KOSPI fell 22.50 points or 1.02% to 2,175.17 and Jakarta Composite lost 33.56 points or 0.53% to 6,265.98.