Bulls hold tight grip over Dalal Street

Bulls were holding a tight grip over the Dalal Street in late morning session, with both Sensex and Nifty trading on a strong note. Positive cues from other Asian markets helped key indices to maintain gaining rally. Traders were positive, as the government said it is taking all steps to strengthen the National Company Law Tribunal (NCLT) to reduce delays in disposal of cases under the insolvency law. Besides, India underlined its commitment to enhanced trade and investment in the Russian Far-East with the two countries identifying sectors such as energy, maritime connectivity, healthcare and tourism as areas of further cooperation in that region.

On the global front, Asian markets were trading in green, after China's exports grew more than expected in November, reports said citing data from the General Administration of Customs on Tuesday. Exports grew 22 percent on a yearly basis in November, which was bigger than the forecast of 19 percent. Likewise, imports advanced 31.7 percent from the last year.

The BSE Sensex is currently trading at 57650.24, up by 903.10 points or 1.59% after trading in a range of 56992.27 and 57656.24. There were 27 stocks advancing against 3 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.82%, while Small cap index was up by 0.99%.

The top gaining sectoral indices on the BSE were Metal up by 2.81%, Bankex up by 2.62%, Realty up by 1.80%, PSU up by 1.73% and Basic Materials up by 1.69%, while there were no losing sectoral indices on the BSE.

The top gainers on the Sensex were Kotak Mahindra Bank up by 3.59%, ICICI Bank up by 3.39%, Axis Bank up by 2.99%, Tata Steel up by 2.88% and Bajaj Finance up by 2.25%. On the flip side, Dr. Reddy's Lab down by 0.49%, Asian Paints down by 0.16% and Bharti Airtel down by 0.10% were the top losers.

Meanwhile, Domestic credit rating agency ICRA in its latest report has said that the looming threat of the newly discovered Omicron variant of Covid-19 can severely affect loan securitisation volumes in the country as concerns over retail asset quality reemerge. It said the new variant of the novel coronoavirus, which has already been reported from a few Indian states, can lead to the volumes of securitisation, where the originator of a loan typically passes on future receivables to another entity for a discount against upfront cash, going down from what was initially estimated.

According to the report, the emergence of the Omicron variant may once again make investors cautious when purchasing retail pools originated by non-banking financial companies (NBFCs) and housing finance companies (HFCs) through direct assignments and securitisation transactions. It said the spread of the virus could reignite worries on statewide or nationwide lockdowns which would have a bearing on the loan collection abilities of the NBFCs and HFCs.

The agency, which had earlier estimated the securitisation volumes (including direct assignments) to rise by up to 40 per cent to Rs 1.2 lakh crore for FY22, with about 60-70 per cent of the volumes being generated in the second half of the fiscal, said securitisation volumes could be severely affected for the rest of the year as the investors would prefer to wait for the threat to subside. It added that if the worry around the Omicron variant grows, the unsecured loan financiers would be worst affected in the securitisation market as the borrowers have a higher probability to miss the loan repayment for an unsecured loan during periods of economic stress.

The CNX Nifty is currently trading at 17172.20, up by 259.95 points or 1.54% after trading in a range of 16987.75 and 17175.05. There were 45 stocks advancing against 5 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 4.15%, Kotak Mahindra Bank up by 3.65%, ICICI Bank up by 3.52%, Axis Bank up by 3.00% and Tata Steel up by 2.94%. On the flip side, Cipla down by 0.85%, SBI Life Insurance down by 0.69%, Divi's Lab down by 0.59%, Dr. Reddy's Lab down by 0.40% and Bharti Airtel down by 0.22% were the top losers.

Asian markets were trading in green; Jakarta Composite soared 45.62 points or 0.7% to 6,592.74, Straits Times advanced 7.64 points or 0.25% to 3,123.96, Shanghai Composite gained 4.42 points or 0.12% to 3,593.73, KOSPI rose 13.90 points or 0.47% to 2,987.15, Taiwan Weighted strengthened 8.23 points or 0.05% to 17,696.44, Nikkei 225 surged 592.07 points or 2.12% to 28,519.44 and Hang Seng increased 340.63 points or 1.46% to 23,690.01.