Volatility continues on Dalal Street

Volatility continued on the Dalal Street in early noon deals, with both Sensex and Nifty trading lower, impacted by heavy selling at Metal and Energy stocks, despite positive cues from other Asian markets. Traders were cautious, amid a private report stating that a dove-turned-hawk in India’s monetary policy committee said demand in the economy was leading to significant price gains and high interest rates are required to keep a lid over inflation, including the core measure. Besides, another private report stated that a derivative trade that boosted demand for India’s sovereign bonds by billions is at risk from a proposed tax, piling pressure on a market straining under record government borrowings.

On the global front, Asian markets were trading mostly in green, after Japan's housing starts recovered strongly in January and at the fastest pace in more than a year. The data from the Ministry of Land, Infrastructure, Transport and Tourism showed that housing starts climbed 6.6 percent year-on-year in January, reversing a 1.7 percent fall in December.

The BSE Sensex is currently trading at 59253.14, down by 35.21 points or 0.06% after trading in a range of 59097.70 and 59483.72. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose by 0.73%, while Small cap index was up by 0.48%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.15%, Auto up by 0.95%, Power up by 0.75%, Utilities up by 0.70% and Industrials up by 0.50%, while Metal down by 1.46%, Energy down by 0.94%, Oil & Gas down by 0.83%, FMCG down by 0.40% and Healthcare down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 2.68%, Mahindra & Mahindra up by 1.90%, Tata Motors up by 1.46%, Power Grid Corporation of India up by 0.96% and Tech Mahindra up by 0.90%. On the flip side, ITC down by 1.41%, Reliance Industries down by 1.10%, NTPC down by 0.78%, Tata Steel down by 0.71% and Hindustan Unilever down by 0.69% were the top losers.

Meanwhile, the Reserve Bank of India (RBI)’s latest data showed that banks' credit growth slowed down to 16.8 percent in the Q3 (October-December) of FY23 from 17.2 percent in the preceding quarter. In the year-ago period, bank credit grew at 8.4 percent. Growth in credit was led by bank branches in metropolitan centres, which account for nearly 60 per cent of the total credit by SCBs and recorded 17.2 per cent rise (y-o-y) in lending; urban, semi-urban and rural centres also recorded double digit credit growth.

According to the data, public sector banks increased their credit portfolio by 15.7 per cent during the calendar year 2022 (4.7 per cent in the year 2021); corresponding growth for private sector banks, however, remained higher at 19.1 per cent (13.1 per cent a year ago). On the deposit front, aggregate deposits increased by 10.3 per cent (y-o-y) in December 2022 (9.6 per cent a year ago), led by 13.2 per cent growth in term deposits; current and savings deposits recorded moderate growth of 4.6 per cent and 7.3 per cent, respectively.

It further showed that deposit mobilisation by public sector banks improved to 8.8 per cent growth (y-o-y) in December 2022 (6.9 per cent a year ago) though it remained lower than 13.2 per cent growth in deposits with private sector banks. The all-India credit-deposit (C-D) ratio increased further to 75.9 per cent in December 2022 (74.8 per cent in the previous quarter and 71.6 per cent in December 2021); it remained above 100 per cent for Andhra Pradesh, Maharashtra, Tamil Nadu, and Telangana.
The CNX Nifty is currently trading at 17386.85, down by 5.85 points or 0.03% after trading in a range of 17343.75 and 17440.45. There were 25 stocks advancing against 25 stocks declining on the index.

The top gainers on Nifty were Adani Enterprises up by 13.66%, Adani Ports and Special Economic Zone up by 5.16%, Asian Paints up by 2.60%, Mahindra & Mahindra up by 1.73% and Tata Motors up by 1.40%. On the flip side, Cipla down by 2.75%, Hindalco down by 2.04%, Coal India down by 1.61%, ITC down by 1.54% and BPCL down by 1.17% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 21.6 points or 0.08% to 27,445.56, Shanghai Composite strengthened 14.35 points or 0.44% to 3,272.38, Jakarta Composite gained 12.22 points or 0.18% to 6,867.00, Straits Times rose 10.67 points or 0.33% to 3,273.91 and KOSPI increased 10.21 points or 0.42% to 2,412.85, while Hang Seng declined 17.1 points or 0.09% to 19,926.41.