Markets turn positive in late afternoon session

Indian benchmarks erased all losses in late afternoon session, with Sensex and Nifty trading above 58400 and 17450 levels, respectively, as investors globally cheered easing of Russia-Ukraine tensions. Except metal, all other sectoral indices are trading in the green. Traders took encouragement after finance ministry’s monthly economic review said that Indian economy is poised to grow at the quickest pace among the league of large nations on the back of various initiatives taken by the government in Budget 2022-23. The current year may as well end with an economic reset manifest of a post-COVID-19 world Manufacturing and Construction will be the ‘growth drivers’, triggered by the PLI schemes and public capex in infrastructure. In scrip specific, Vedant Fashions has debuted at Rs 936.00 on the BSE, up by 70 points or 8.08% from its issue price of Rs 866.00.

On the global front, all Asian markets and European markets were trading higher as fears of a Russian invasion of the Ukraine this week dissipated after Moscow indicated it was returning some troops to base in an apparent de-escalation, delivering investors a measure of relief.

The BSE Sensex is currently trading at 58426.27, up by 284.22 points or 0.49% after trading in a range of 57780.28 and 58569.22. There were 23 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.65%, while Small cap index was up by 1.13%.

The top gaining sectoral indices on the BSE were Telecom up by 1.95%, Realty up by 1.90%, Oil & Gas up by 1.37%, Consumer Durables up by 1.21% and Utilities was up by 1.10%, while Metal was down by 0.26% only losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 2.28%, Mahindra & Mahindra up by 2.14%, HDFC up by 2.03%, Dr. Reddy's Lab up by 1.96% and Kotak Mahindra Bank up by 1.78%. On the flip side, Power Grid down by 2.83%, Ultratech Cement down by 0.70%, NTPC down by 0.59%, SBI down by 0.28% and Tata Steel down by 0.25% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) has allowed some relaxation in the stricter prudential norms announced for all lenders, including NBFCs, on November 2021, by extending the time till September 2022 to implement the guidelines regarding upgrading an NPA account as standard but upon clearing all dues. In a circular issued on November 12, 2021, the monetary authority had given time till December 31, 2021 to implement all the stricter prudential norms.

Following representation from NBFCs, in a revised circular issued on February 15, 2022, the central bank said ‘the new circular does not, in any way, interfere with the extant guidelines on the implementation of Ind-AS by NBFCs loan accounts classified as NPAs may be upgraded as 'standard' asset only if the entire arrears of interest and principal are paid by the borrower. (Also), NBFCs shall have time till September 30, 2022 to put in place the necessary systems to implement this provision.’

The November 12, 2021 circular was an improvement on its October 1, 2021 circular on the prudential norms on income recognition, asset classification and provisioning pertaining to advances, wherein the RBI had prevented all types of lenders from upgrading an NPA account after getting only interest dues cleared. This was issued after the central bank observed that some lenders were upgrading NPA accounts to standard on payment of only interest overdues, partial overdues, etc.

To avoid any ambiguity in this regard, the apex bank had said it is clarified that loan accounts classified as NPAs may be upgraded as a standard account only if the entire arrears of interest and principal are paid by the borrower. The revised circular also said the definition of 'out of order', as clarified in the November 2021 circular, shall be applicable to all loans offered as an overdraft facility, including those not meant for business purposes and/or which entail interest repayments as the only credits.

The CNX Nifty is currently trading at 17458.70, up by 106.25 points or 0.61% after trading in a range of 17257.70 and 17490.60. There were 36 stocks advancing against 14 stocks declining on the index.

The top gainers on Nifty were Divi's Lab up by 3.43%, Adani Ports up by 3.40%, Indian Oil up by 2.65%, HDFC Life Insurance up by 2.51% and Bharti Airtel up by 2.14%. On the flip side, Power Grid Corp down by 2.73%, Eicher Motors down by 1.12%, Ultratech Cement down by 0.76%, Hindalco down by 0.72% and NTPC down by 0.52% were the top losers.

All Asian markets were trading higher, Nikkei 225 surged 595.21 points or 2.22% to 27,460.40, Hang Seng increased 363.19 points or 1.49% to 24,718.90, Taiwan Weighted strengthened 279.66 points or 1.56% to 18,231.47, KOSPI rose 53.14 points or 1.99% to 2,729.68, Jakarta Composite soared 42.70 points or 0.63% to 6,850.20, Shanghai Composite gained 19.74 points or 0.57% to 3,465.83 and Straits Times was up by 19.27 points or 0.56% to 3,440.65.

European markets were trading higher, UK’s FTSE 100 increased 7.80 points or 0.1% to 7,616.72, France’s CAC increased 39.47 points or 0.57% to 7,019.44 and Germany’s DAX was up by 81.86 points or 0.53% to 15,494.57.