Benchmarks trade flat after negative start

Indian equity benchmarks made negative start on Friday following mixed cues from the US markets overnight as well as lackluster trade in Asian counterparts after the latest batch of economic data from the U.S., Europe and Asia raised worries about a global economic slowdown. Selling pressures in banking and financial counter weighted down on the markets, after the Reserve Bank of India (RBI) strengthened rules on personal loans and credit cards. But, soon markets managed to trim their losses and are trading flat in early deals amid foreign fund inflows. Provisional data from the National Stock Exchange showed that foreign institutional investors net bought shares worth Rs 957.25 crore on November 16. Traders took encouragement as S&P Global Ratings said in a report that India's GDP growth prospects should remain strong over the medium term, with GDP expanding 6-7.1 percent annually in fiscal years 2024-2026. 

Meanwhile, oil-linked stocks such as oil marketing companies, paints, tyres, oil explorers, etc are in focus after Brent crude tumbled 5 per cent Thursday to hover around $77 per barrel-mark. Besides, JSW Infrastructure soared on winning a bid to develop a greenfield port in Karnataka.

The BSE Sensex is currently trading at 65954.34, down by 28.14 points or 0.04% after trading in a range of 65639.74 and 65958.37. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.37%, while Small cap index was up by 0.49%.

The top gaining sectoral indices on the BSE were Consumer Discretionary up by 0.90%, Auto up by 0.84%, Industrials up by 0.84%, Capital Goods up by 0.74% and Healthcare up by 0.67%, while Bankex down by 0.80%, PSU down by 0.36%, Energy down by 0.02% were the few losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 2.92%, Hindustan Unilever up by 1.10%, Mahindra & Mahindra up by 1.09%, Nestle up by 1.00% and Tata Motors up by 0.92%. On the flip side, Axis Bank down by 2.33%, SBI down by 2.26%, Bajaj Finance down by 2.08%, Bajaj Finserv down by 1.42% and HDFC Bank down by 0.43% were the top losers.

Meanwhile, S&P Global Ratings expressing confident over India’s economic growth has said that the country’s economic growth prospects should remain strong over the medium term, with gross domestic product (GDP) expanding 6-7.1 per cent annually in fiscal years 2024-2026. In a report titled ‘Global Banks Country-By-Country Outlook 2024’, S&P said the banking sector’s weak loans will decline to 3-3.5 per cent of gross advances by March 31, 2025, on the back of structural improvement, including healthy corporate balance sheets, tighter underwriting standards and improved risk-management practices.

It added that interest rates in India are unlikely to rise materially, and this should limit the risk for the banking industry. S&P Primary Credit Analyst Deepali Seth Chhabria said ‘Unsecured personal loans have grown rapidly and could contribute to incremental NPLs. We believe underwriting standards for retail loans generally remain healthy and overall level of delinquencies remains within acceptable limits for this product category’.

The report said that global uncertainties will have a lesser impact on the Indian economy. It further said slower global growth and external demand will weigh on economic activity and could fuel further inflation. However, given that India is domestically oriented, the agency expects the economic growth to be less affected. Meanwhile, India’s real GDP rose 7.8 per cent year-on-year in the June quarter, up from 6.1 per cent in the March quarter.

The CNX Nifty is currently trading at 19778.85, up by 13.65 points or 0.07% after trading in a range of 19667.45 and 19787.10. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were SBI Life Insurance up by 4.74%, HDFC Life Insurance up by 2.95%, Asian Paints up by 2.58%, BPCL up by 1.42% and Hero MotoCorp up by 1.31%. On the flip side, SBI down by 2.36%, Axis Bank down by 2.25%, Bajaj Finance down by 1.91%, ONGC down by 1.24% and Bajaj Finserv down by 0.73% were the top losers.

Asian markets are trading mixed; Hang Seng declined 383.63 points or 2.15% to 17,449.19, KOSPI dropped 18.60 points or 0.75% to 2,469.58, Straits Times fell 14.66 points or 0.47% to 3,118.39 and Shanghai Composite was down by 4.78 points or 0.16% to 3,046.15. On the other hand, Taiwan Weighted rose 58.41 points or 0.34% to 17,229.59, Nikkei 225 added 46.11 points or 0.14% to 33,470.52 and Jakarta Composite was up by 3.73 points or 0.05% to 6,961.74.