Benchmarks trade higher with notable gains in early deals

Indian equity benchmarks made positive start on Tuesday tracking firm global cues. Markets are trading firm with notable gains in early deals on account of buying in Realty, Metal and Utilities stocks. Traders took encouragement as data released by the government showed that India’s industrial production grew 29.3 per cent in May over the same period a year ago, as the impact of a favourable base continued for yet another month. Some support also came in with a private report that the Indian economy is at the start of a virtuous cycle and on the path to becoming a $15 trillion economy over the next two decades. However, upside remained capped amid cautions over data by government showing that India's retail inflation eased slightly to 6.26 per cent in June, but stayed above the Reserve Bank's tolerance range (2 per cent-6 per cent) for the second straight month. Meanwhile, India has recorded 30,827 fresh cases taking the total caseload to 30,904,734, according to Worldometer.

Most of the Asian markets were trading higher following the positive cues from Wall Street overnight, as economic optimism is tempering coronavirus concerns. Traders are keeping an eye on news about the spread of the delta variant of the coronavirus in several parts of the world. Back home, the Media and entertainment (ME) industry stocks were in focus with a private report that the country's ME sector will be the fastest growing globally in terms of both consumer and advertising spends, and will be an over-Rs 4-lakh-crore industry by 2025. In scrip specific development, Tata Motors gained after introducing the dark edition of Altroz, Nexon, Nexon EV and Harrier.

The BSE Sensex is currently trading at 52586.74, up by 214.05 points or 0.41% after trading in a range of 52559.16 and 52716.83. There were 24 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.05%, while Small cap index was up by 0.49%.

The top gaining sectoral indices on the BSE were Realty up by 1.82%, Metal up by 0.97%, Utilities up by 0.83%, PSU up by 0.80%, Oil & Gas up by 0.73%, while IT down by 0.27%, TECK down by 0.26% were the only losing indices on BSE.

The top gainers on the Sensex were NTPC up by 3.18%, ICICI Bank up by 1.69%, HDFC up by 1.37%, Axis Bank up by 0.96% and Tata Steel up by 0.94%. On the flip side, Tech Mahindra down by 0.71%, Infosys down by 0.53%, HCL Technologies down by 0.51%, Hindustan Unilever down by 0.12% and Kotak Mahindra Bank down by 0.02% were the top losers.

Meanwhile, rating agency  -- Crisil has said non-banking finance companies (NBFCs) are better placed currently on the liquidity front than they were a year ago, enabling them to service their near debt without much difficulty, despite a fall in collections because of the second wave of Covid-19. However, the pace of improvement in collection efficiency, the third of the wave of the pandemic, and access to funds need to be closely monitored.

It sated collections have once again been affected in the current fiscal by the second wave. The decline has been more pronounced in May (sequentially) because containment measures in most parts of the country kicked in only in the latter part of April. A gradual lifting of restrictions has resulted in an improvement in collections in June, but to a level still lower than March 2021.

Besides, an analysis by the rating agency indicated that under scenario-1, where it was assumed that collection in the next quarter would be 70 per cent of what it was in the past couple of quarters, almost 96 per cent of Crisil-rated NBFCs were found to have liquidity cover for three months of debt repayments. In the second scenario, where it was assumed that collection in the next quarter would be half of what it was in the past few quarters, it was found that almost 95 per cent of the NBFCs rated by the agency would have enough liquidity to cover three months of debt repayments.

The CNX Nifty is currently trading at 15769.00, up by 76.40 points or 0.49% after trading in a range of 15747.90 and 15796.25. There were 43 stocks advancing against 6 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were NTPC up by 3.18%, ICICI Bank up by 1.83%, Hindalco up by 1.56%, HDFC up by 1.47% and Sun Pharma up by 1.27%. On the flip side, Adani Ports & SEZ down by 0.99%, Tech Mahindra down by 0.66%, HCL Technologies down by 0.53%, Infosys down by 0.38% and Tata Consumer Products down by 0.26% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 179.01 points or 0.63% to 28,748.03, Straits Times rose 17.34 points or 0.55% to 3,164.48, Hang Seng jumped 491.51 points or 1.79% to 28,006.75, Taiwan Weighted added 97.21 points or 0.55% to 17,911.54, KOSPI gained 22.43 points or 0.69% to 3,268.90 and Shanghai Composite was up by 8.43 points or 0.24% to 3,556.27, while Jakarta Composite fell 5.39 points or 0.09% to 6,073.18.