Markets trade slightly higher in late morning deals

Indian equity markets were trading slightly higher in late morning deals as traders got some support with Commerce and Industry Minister Piyush Goyal’s statement that huge opportunities for people and businesses will be opened up when the country's goods and services exports touch USD 2 trillion by 2030. In the last two years, he said the country's exports jumped from USD 500 billion to USD 767 billion in 2022-23. Further, some support also came in as the finance ministry said Goods and Services Tax (GST) collection rose 12 per cent to Rs 1.57 lakh crore in May 2023.  Besides, positive cues from global markets also supported domestic sentiments. On the BSE sectoral front, traders were seen pilling up position in Realty, Metal, Consumer Durables, Telecom and Industrials, while selling was witnessed in Oil & Gas, TECK, Energy, IT and Utilities. 

On the global front, Asian markets were trading in green following the broadly positive cues from US markets overnight, as risk sentiment improved after the bill to raise US debt limit and cap government spending in the U.S. was passed by a wide margin to remove a source of uncertainty in the markets. Back home, in the stock specific developments, Hero MotoCorp surged after the company reported volume growth of 31.1 per cent month-on-month (MoM) at 519,474 units in the month of May 2023. NCC rose after the company received new orders aggregating Rs 2,088 crore (excluding GST) in the month of May 2023. 

The BSE Sensex is currently trading at 62487.61, up by 59.07 points or 0.09% after trading in a range of 62379.86 and 62719.84. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.50%, while Small cap index up by 0.71%.

The top gaining sectoral indices on the BSE were Realty up by 1.01%, Metal up by 0.91%, Consumer Durables up by 0.78%, Telecom up by 0.68% and Industrials up by 0.67%, while Oil & Gas down by 0.40%, TECK down by 0.33%, Energy down by 0.25%, IT down by 0.05% and Utilities down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Titan up by 1.29%, Tata Steel up by 0.99%, Hindustan Unilever up by 0.97%, Ultratech Cement up by 0.72% and ITC up by 0.72%. On the flip side, Infosys down by 1.17%, TCS down by 0.46%, Wipro down by 0.34%, Indusind Bank down by 0.31% and HCL down by 0.27% were the top losers.

Meanwhile, global rating agency Fitch in its latest report has said that a rise in risk appetite among Indian banks highlights the importance of assessing individual banks' ability to withstand expected and unexpected balance-sheet stress as part of the analysis of their intrinsic creditworthiness. Banks' loan growth over the financial year ended March 2023 (FY23) reached 15.4 per cent, the highest since FY12. 

It said ‘we believe, this partly reflected pent-up credit demand following the Covid-19 pandemic, as well as strong nominal GDP growth, and we expect some normalisation in FY24’. However, rapid loan growth and higher exposure to certain asset classes are also likely to indicate greater risk appetite and could affect risk profiles, adding increasing risk appetite reflects in part banks’ efforts to boost returns after funding costs rose over 2022, even as they manage asset growth relative to capital.

The report further said notably, credit card lending and personal loans exposure rose to 10.2 per cent of system loans by FY23, from 7.5 per cent in FY18. It said ‘we view such unsecured categories as most vulnerable to potential stress, though exposures among our rated entities remain manageable, and improvements in risk controls and loan-book granularity should help to reduce risks associated with any future asset-quality deterioration relative to previous cycles. We also expect tighter regulatory supervision to slow unsecured lending in the year ahead’.

The CNX Nifty is currently trading at 18511.30, up by 23.55 points or 0.13% after trading in a range of 18478.40 and 18573.70. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Hero MotoCorp up by 2.16%, Hindalco up by 2.05%, Titan up by 1.22%, Adani Ports up by 1.10% and Apollo Hospital up by 1.00%. On the flip side, Eicher Motors down by 1.24%, Infosys down by 1.23%, HCL down by 0.49%, TCS down by 0.45% and Cipla down by 0.42% were the top losers.

Asian markets were trading in green; Taiwan Weighted added 184.9 points or 1.11% to 16,697.55, Hang Seng advanced 669.28 points or 3.67% to 18,886.19, Shanghai Composite strengthened 24.04 points or 0.75% to 3,228.67, KOSPI increased 28.14 points or 1.1% to 2,597.31 and Nikkei 225 surged 340.49 points or 1.09% to 31,488.50.