Key indices keep head above water in noon deals

Local equity benchmarks managed to keep their head above water in noon deals with both Sensex and Nifty were trading above 53,400 and 15,900 marks, respectively. Some support came with RBI report showing that bank credit grew by 13.29 per cent to Rs 123.81 lakh crore and deposits by 9.77 per cent to Rs 169.61 lakh crore in the fortnight ended on July 1. However, upside remain capped as India's merchandise trade deficit rose to a record $26.1 billion in June 2022, 172 percent higher than June 2021 as a continuing global commodity super cycle kept the prices of key energy and metal imports high. Meanwhile, Finance Minister Nirmala Sitharaman stated that India's long-term growth prospects are embedded in public capital expenditure programmes. Traders were seen in selling position for Metal, IT and TECK stocks, while buying was witnessed in Auto, Consumer Durables and Telecom stocks. On the global front, Asian markets were trading mostly higher with the optimism that Central Banks can tackle soaring inflation by aggressive monetary policy tightening without inducing recession.

The BSE Sensex is currently trading at 53435.19, up by 19.04 points or 0.04% after trading in a range of 53383.75 and 53755.96. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green and red; the BSE Mid cap index rose 0.26%, while Small cap index was down by 0.04%.

The top gaining sectoral indices on the BSE were Auto up by 1.21%, Consumer Durables up by 1.13%, Telecom up by 1.00%, FMCG up by 0.80%, Consumer Discretionary was up by 0.67%, while Metal down by 1.10%, IT down by 0.86%, TECK down by 0.51%, PSU down by 0.46% and Bankex was down by 0.39% were the top losing indices on BSE.

The top gainers on the Sensex were Titan Co up by 2.36%, Bharti Airtel up by 2.17%, Mahindra & Mahindra up by 2.06%, Hindustan Unilever up by 1.76% and HDFC was up by 1.54%. On the flip side, Wipro down by 2.28%, HCL Tech down by 1.99%, Tata Steel down by 1.93%, Power Grid down by 1.16% and Axis Bank was down by 1.05% were the top losers.

Meanwhile, Crisil Ratings in its latest report has said that securitisation volumes increased by 70 per cent to Rs 35,000 crore in the April-June quarter of FY23 (Q1FY23) and the credit growth at non-banks may take the number to the pre-pandemic highs of Rs 1.9 lakh crore in FY23. It noted that the volumes were high in first quarter of FY23 primarily due to increase in economic activity, while the high growth came on the back of a low base.

According to the report, volumes of securitization, where a financier raises money by giving up on future loan receivables, in the first quarter could have been even higher but for the rising inflation and higher interest rates that have spawned caution over the repayment ability of borrowers, and divergent yield expectations among originators and investors. It said despite the apparent return of enthusiasm among participants, a number of deals fell through at the quarter-end. Still, negligible disruption in collections and stable pool performance supported uptick in volume.

It said mortgage-backed securitisation (MBS) loans comprised 45 per cent of quarterly volume as compared with 53 per cent in the corresponding period of the previous fiscal. Asset backed securitisation (ABS) comprised the balance. More than 80 non-bank entities being present in the market in the first quarter, up from 50 last fiscal, indicates strong comfort originators have with the securitisation process. In ABS, commercial vehicle loans comprised 49 per cent, and microfinance 20 per cent of transaction value, with many underlying loans eligible for priority sector lending (PSL) classification.

The CNX Nifty is currently trading at 15944.75, up by 6.10 points or 0.04% after trading in a range of 15934.90 and 16041.25. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Tata Consumer Products up by 2.77%, Titan Co up by 2.40%, Bharti Airtel up by 2.27%, Mahindra & Mahindra up by 1.96% and Hindustan Unilever was up by 1.59%. On the flip side, Wipro down by 2.33%, Tata Steel down by 2.06%, HCL Tech. down by 1.94%, ONGC down by 1.45% and JSW Steel was down by 1.44% were the top losers.

Asian markets were trading mostly in green, Straits Times advanced 2.91 points or 0.09% to 3,093.54, KOSPI rose 8.66 points or 0.37% to 2,330.98, Jakarta Composite soared 15.01 points or 0.22% to 6,705.10, Taiwan Weighted strengthened 112.10 points or 0.78% to 14,550.62 and Nikkei 225 was up by 145.08 points or 0.54% to 26,788.47. On the flip side, Shanghai Composite declined 31.67 points or 0.97% to 3,250.07 and Hang Seng was down by 438.82 points or 2.11% to 20,312.39.