Bourses sustain gains in late afternoon session

Barometer gauges sustained their gains in late afternoon session ahead of the outcome of the Federal Reserve policy meeting. Investors are expecting the US central bank to raise interest rates for the first time in three years by at least 25 basis points amid surging prices. Traders overlooked finance ministry  statement that the recent spike in crude oil prices, if sustained well into FY23, will pose downside risk to growth estimates of some agencies that have predicted GDP to rise in the 8-10% range in the next fiscal. On the global front, all Asian markets were trading higher after their recent rout, with Hong Kong leading the way after Chinese authorities pledged to provide support and stability to the country's troubled markets. European markets were trading higher amid investors awaited the U.S. Federal Reserve's interest rate decision.

The BSE Sensex is currently trading at 56,579.09, up by 802.24 points or 1.44% after trading in a range of 56389.26 and 56761.01. There were 28 stocks advancing against 2 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 1.51%, while Small cap index was up by 1.27%.

The top gaining sectoral indices on the BSE were Realty up by 2.86%, Metal up by 2.41%, Basic Materials up by 2.11%, Consumer Durables up by 1.70% and Auto was up by 1.70%, while there were no losers on the sectoral indices on the BSE.

The top gainers on the Sensex were Ultratech Cement up by 3.56%, Indusind Bank up by 3.33%, Axis Bank up by 3.28%, Tata Steel up by 2.54% and Bajaj Finance up by 2.38%. On the flip side, Sun Pharma down by 1.12% and Hindustan Unilever down by 0.02% were the top losers.

Meanwhile, a day after the RBI announced ‘Master Direction - Reserve Bank of India (Regulatory Framework for Microfinance Loans) Directions, 2022’, credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has said that the key changes in the final regulations for microfinance institutions (MFIs) will bring in the entire industry under the regulatory coverage unlike one-third of the industry coverage earlier.

As per the report, the ability of small and mid-sized MFIs players to implement risk-based pricing would enable building both scale and operating buffers, resulting in improved credit worthiness in the eyes of lenders. This is in line with the agency’s FY23 Outlook: Microfinance where it had said that the viability of the small-medium MFIs could improve post the implementation of the proposed harmonisation guidelines. The rating agency also said that the notification is also expected to improve the ability of non-bank finance company (NBFC)-MFIs to penetrate into newer geographies, as pricing can now be differentiated, and cover the higher operating costs for the same.

Meanwhile, the key changes in the final regulations include the widening of the definition of regulated entities to include commercial banks, co-operative banks, district/state central co-operative banks, NBFC-MFIs, NBFC housing finance companies (HFCs), as well as the removal of pricing caps.

The CNX Nifty is currently trading at 16,894.05, up by 231.05 points or 1.39% after trading in a range of 16837.85 and 16942.60. There were 44 stocks advancing against 6 stocks declining on the index.

The top gainers on Nifty were Ultratech Cement up by 3.55%, Axis Bank up by 3.27%, Indusind Bank up by 3.23%, Shree Cement up by 2.76% and HDFC Life Insurance up by 2.69%. On the flip side, Cipla down by 1.10%, Sun Pharma down by 1.08%, Tata Consumer down by 0.46%, Power Grid down by 0.10% and Divi's Lab down by 0.08% were the top losers.

All Asian markets were trading higher, Hang Seng increased 1672.42 points or 9.08% to 20,087.50, Nikkei 225 surged 415.53 points or 1.64% to 25,762.01, Shanghai Composite gained 106.74 points or 3.48% to 3,170.71, Jakarta Composite soared 74.21 points or 1.07% to 6,992.40, Straits Times advanced 60.99 points or 1.88% to 3,297.03, KOSPI rose 37.70 points or 1.44% to 2,659.23 and Taiwan Weighted was up by 14.77 points or 0.09% to 16,940.83.

European markets were trading higher, UK’s FTSE 100 increased 103.02 points or 1.44% to 7,278.72, France’s CAC increased 154.90 points or 2.44% to 6,509.90 and Germany’s DAX was up by 376.32 points or 2.7% to 14,293.59.