Indian stock markets continue to trade in positive terrain

Indian stock markets continued to trade in positive terrain in the noon session due to buying in metal, healthcare and basic materials stocks. Buying in frontline stocks such as Tata Steel, Sun Pharma and Power Grid were aiding sentiment, while selling in Wipro, HDFC Bank and Maruti Suzuki kept the gains in the markets in check. Traders were encouraged as World Bank predicted that the Narendra Modi government's Production-Linked Incentive (PLI) Scheme will help India's economy develop at an annual rate of 8.7% in fiscal year 2022-23, outpacing emerging market counterparts such as China. Additional support came in as India's Bharat Biotech stated that the booster shot of its Covaxin COVID-19 vaccine administered six months after the last of two doses neutralises both the Omicron and Delta variants of the coronavirus. However, upside remain capped as traders were worried as retail inflation quickened to a six-month high of 5.59% in December from a year before and industrial production growth nosedived to a nine-month low of 1.4% in November, presenting a double whammy for policy-makers as they brace for the next year’s Budget.

On the global front, Asian markets were trading mostly lower as investors fear stiff monetary policies ahead. Also challenging the sentiment are issues concerning the coronavirus and geopolitics that together drowns risk appetite. Back home, BSE Sensex is currently trading at 61236.94, up by 86.90 points or 0.14% after trading in a range of 60949.81 and 61348.57. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.24%, while Small cap index was up by 0.55%.

The top gaining sectoral indices on the BSE were Metal up by 3.18%, Healthcare up by 1.28%, Basic Materials up by 1.28%, Capital Goods up by 1.01% and PSU was up by 0.74%, while Realty down by 0.75%, Bankex down by 0.47%, Auto down by 0.26%, Consumer Durables down by 0.19%, Consumer Discretionary was down by 0.04% were the losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 4.83%, Sun Pharma up by 3.72%, Power Grid up by 1.90%, Larsen & Toubro up by 1.31% and Bajaj Finserv was up by 1.23%. On the flip side, Wipro down by 5.55%, HDFC Bank down by 1.68%, Maruti Suzuki down by 1.37%, Kotak Mahindra Bank down by 0.78% and Axis Bank was down by 0.78% were the top losers.

Meanwhile, SBI Research in its latest report has said that credit growth, which has been lagging deposits for years, has turned buoyant in the third quarter of this fiscal (Q3FY22) by a wide margin at Rs 3.5 lakh crore as against a steep Rs 2.2 lakh crore decline in deposits, indicating that corporates' plans of capacity expansion across sectors.

According to the report, credit growth across banks, which had considerably weakened since FY20, has picked up significantly and was at 7.3 per cent to the week to December 17, 2021 -- a tad lower than pre-pandemic level of 7.5 per cent in December 2019. On the other hand, deposits which was consistently in double-digits since the beginning of the pandemic and was at 12.3 per cent in March 2021 have decelerated to 9.5 per cent in December 2021 -- lower than the pre-pandemic level of 10 per cent. The Q3 of FY22 has seen a visible expansion in credit growth across sectors with incremental CD (credit-deposit) ratio at 133 in Q3 as against only 2 in H1. Incremental deposits declined by Rs 2.2 lakh crore during this time while net credit sales rose by Rs 3.5 lakh crore.

Accordingly, the report said gross bank credit grew from Rs 1,04,349 crore in November 2020 to Rs 1,09,516 crore in March 2021, and further to Rs 1,08,975 crore in August 2021, rising again to Rs 1,11,622 crore in November 2021. Of this the share of industries stood at Rs 27,602 crore, Rs 28,958 crore, Rs 28,196 crore and Rs 28,654 crore, respectively during this period.

The CNX Nifty is currently trading at 18248.25, up by 35.90 points or 0.20% after trading in a range of 18163.80 and 18272.25. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 4.83%, Sun Pharma up by 3.71%, Coal India up by 3.70%, JSW Steel up by 3.43% and UPL was up by 2.38%. On the flip side, Wipro down by 5.74%, HDFC Bank down by 1.71%, Maruti Suzuki down by 1.39%, Tata Consumer Products down by 1.28% and Kotak Mahindra Bank was down by 0.85% were the top losers.

Asian markets were trading mostly lower; KOSPI fell 6.27 points or 0.21% to 2,966.21, Hang Seng decreased 14.26 points or 0.06% to 24,387.91, Shanghai Composite declined 31.76 points or 0.88% to 3,565.67, Jakarta Composite lost 9.35 points or 0.14% to 6,637.72, Nikkei 225 slipped 276.53 points or 0.96% to 28,489.13 and Straits Times was down by 2.74 points or 0.08% to 3,252.24. On the other hand, Taiwan Weighted was up by 61.53 points or 0.33% to 18,436.93.