Key indices remain in green in morning deals

Indian equity benchmarks continued to trade in green in morning deals, ahead of weekly expiry of index futures and option contracts later in the day amid firm cues from other Asian markets. Sentiments remained positive with a private report stated that IT spending in the country is expected to grow at 8 per cent to $92.7 billion in 2021. The growth at 8 percent is a shade less than the world average of 8.6 per cent and global spends on information technology are estimated to come at $4.2 trillion. Some support also came with ICRA Ratings’ survey stating that around 42 percent of non-banking financial companies (NBFCs) expect a growth of more than 15 per cent in their asset under management (AUM) in fiscal 2021-22. It said NBFCs growth expectations have moderated vis-a-vis the expectations six months earlier. Meanwhile, Rating agency Crisil in its latest report said the Reserve Bank of India's (RBI) insistence on companies opening current accounts with banks is among the factors that has helped large lenders such as HDFC Bank, ICICI Bank and SBI raise their shares of the competitive corporate banking market in 2020. It stated apart from the RBI rules, the government's mega merger to reduce the number of state-owned banks has also helped in the trend.

On the global front, Asian markets were trading mostly in green after Fed Chair Jerome Powell assured that inflation pressures won't last and the Fed will give 'advance notice' before making any changes to the central bank's asset purchase program. Back home, on the sectoral front,  Auto stocks were in focus as Society of Indian Automobile Manufacturers (SIAM) said  passenger vehicle wholesales in India rose to 2,31,633 units in June as compared with 1,05,617 units in the same month of 2020 which saw massive COVID-19 related disruptions.

The BSE Sensex is currently trading at 53041.39, up by 137.34 points or 0.26% after trading in a range of 52948.43 and 53084.45. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.17%, while Small cap index was up by 0.57%.

The top gaining sectoral indices on the BSE were Capital Goods up by 2.10%, Industrials up by 1.10%, IT up by 0.91%, TECK up by 0.51% and Bankex up by 0.30%, while Oil & Gas down by 0.50%, Telecom down by 0.35%, Auto down by 0.27%, Energy down by 0.23% and PSU down by 0.21% were the top losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 4.36%, HCL Technologies up by 3.30%, Tech Mahindra up by 2.48%, HDFC Bank up by 0.69% and Bajaj Finserv up by 0.57%. On the flip side, Mahindra & Mahindra down by 1.18%, Asian Paints down by 0.62%, NTPC down by 0.58%, Maruti Suzuki down by 0.46% and ITC down by 0.42% were the top losers.

Meanwhile, ICRA Ratings in its latest survey has said that around 42 percent of non-banking financial companies (NBFCs) expect a growth of more than 15 per cent in their asset under management (AUM) in fiscal 2021-22. It said NBFCs growth expectations have moderated vis-a-vis the expectations six months earlier. This follows the possible impact of Covid 2.0 on business in Q1 FY2022. With most of the lenders (74 per cent in AUM terms) indicating an up to 10 per cent AUM growth, it expects the growth for the overall industry to be about 7-9 per cent for FY2022.

According to the survey, within the non-bank finance sector, segments like MFIs, SME-focussed NBFCs and affordable housing finance would continue to record much higher growth than the overall industry averages, supported by good demand and lower base, she said. It said with gradual easing of lockdowns and moderation in fresh cases of Covid and with increased vaccination coverage, the lenders are optimistic on growth pick-up in balance part of FY2022 and expect it to be higher than the growth seen in FY2021.

However, it said the non-bank finance companies are expecting the asset quality related pain to persist in the current fiscal as well. It also said overall, 87 per cent of issuers (by AUM) expect reported gross stage 3/ NPAs to be either same or higher than March 2021 levels, which in turn will keep the credit costs elevated. Over 90 per cent of lenders (by AUM) expects the credit costs to remain stable or increase further over FY2021 levels.

The CNX Nifty is currently trading at 15892.40, up by 38.45 points or 0.24% after trading in a range of 15855.00 and 15902.20. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Larsen & Toubro up by 4.29%, HCL Technologies up by 3.44%, Wipro up by 2.59%, Tech Mahindra up by 2.56% and HDFC Life Insurance up by 0.97%. On the flip side, ONGC down by 2.77%, Mahindra & Mahindra down by 1.19%, Eicher Motors down by 0.80%, NTPC down by 0.66% and Asian Paints down by 0.63% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 339.06 points or 1.22% to 28,126.52, Taiwan Weighted strengthened 124.59 points or 0.7% to 17,970.34, Jakarta Composite soared 47.69 points or 0.8% to 6,026.91, KOSPI rose 16.29 points or 0.5% to 3,281.10 and Shanghai Composite gained 8.21 points or 0.23% to 3,536.71.

On the flip side, Straits Times trembled 12.27 points or 0.39% to 3,140.88 and Nikkei 225 slipped 329.31 points or 1.15% to 28,279.18.