Trade over Dalal Street remain muted in early noon deals

A trade over the Dalal Street remained muted in early afternoon deals, with both Sensex and Nifty trading just above their neutral lines. Traders were cautious after the Reserve Bank of India (RBI) Governor, Shaktikanta Das has said that there is no scope for any complacency and banks should continue to maintain their vigil around build-up of risks, if any. In the meeting with banks’ MDs & CEOs, Das highlighted the issues relating to Business Model viability; outlier growth in personal loans; adherence to co-lending guidelines; Bank exposure to NBFC sector; Liquidity Risk Management; IT and Cyber security preparedness, operational resilience, digital frauds; and strengthening of the internal rating framework. 

However, indices were managing to keep their heads above water, tracking positive cues from other Asian markets along with heavy buying at PSU, Oil & Gas and Energy counters. Some support came with a private report stating that the value of FPIs (Foreign Portfolio Investors) holding in Indian equities reached $738 billion in the three months ended December 2023, marking a surge of 13 per cent from the preceding quarter, driven by the strong performance of the domestic stock market. The value of FPIs investment was at $651 billion in the September quarter of the current fiscal. On a year-on-year basis, the value of such investments rose 26 per cent from $584 billion in December 2022.

On the global front, Asian markets were trading mostly in green, after Singapore's gross domestic product expanded a seasonally adjusted 1.2 percent on quarter in the fourth quarter of 2023. That was shy of expectations for an increase of 1.7 percent and slowed from 1.3 percent in the third quarter. On an annualized basis, GDP rose 2.2 percent - again missing forecasts for a gain of 2.8 percent but up from 1.0 percent in the three months prior.

The BSE Sensex is currently trading at 71842.13, up by 19.30 points or 0.03% after trading in a range of 71644.44 and 72090.49. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.79%, while Small cap index was up by 1.20%.

The top gaining sectoral indices on the BSE were PSU up by 2.49%, Oil & Gas up by 2.48%, Energy up by 2.26%, Utilities up by 1.90% and Power up by 1.39%, while FMCG down by 0.45%, Healthcare down by 0.25% and Consumer Durables down by 0.16% were the few losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 5.42%, SBI up by 1.82%, NTPC up by 1.72%, HDFC Bank up by 1.47% and Power Grid up by 1.28%. On the flip side, Axis Bank down by 1.90%, Nestle down by 1.30%, HCL Tech. down by 1.19%, Kotak Mahindra Bank down by 1.16% and Hindustan Unilever down by 1.00% were the top losers.

Meanwhile, noting the resilience of the domestic financial system with healthy balance sheets of banks, the Reserve Bank of India (RBI) Governor, Shaktikanta Das has said that there is no scope for any complacency and banks should continue to maintain their vigil around build-up of risks, if any. He complimented the banks on their improved financial performance and that of the whole banking sector.

In the meeting with banks’ MDs & CEOs, Das highlighted the issues relating to Business Model viability; outlier growth in personal loans; adherence to co-lending guidelines; Bank exposure to NBFC sector; Liquidity Risk Management; IT and Cyber security preparedness, operational resilience, digital frauds; and strengthening of the internal rating framework. 

RBI Governor stressed that customer grievance redress mechanism and protection of customers’ interests are of paramount importance for the safety and stability of the financial system and that of individual financial institutions. The Governor also encouraged the banks to actively participate in RBI’s FinTech initiatives and give a further push to the Digital Banking Units (DBUs).

Meanwhile, RBI Governor held meetings with the MDs & CEOs of Public Sector Banks and select Private Sector Banks on February 14, 2024, in Mumbai. These engagements are part of Reserve Bank’s continuous interaction with the Senior Management of its Regulated/Supervised Entities. The previous such meeting was held on July 11, 2023.

The CNX Nifty is currently trading at 21853.40, up by 13.35 points or 0.06% after trading in a range of 21794.80 and 21923.25. There were 25 stocks advancing against 25 stocks declining on the index.

The top gainers on Nifty were Mahindra & Mahindra up by 5.39%, BPCL up by 3.75%, ONGC up by 3.18%, Coal India up by 2.28% and SBI up by 1.81%. On the flip side, Axis Bank down by 1.96%, Britannia down by 1.36%, Nestle down by 1.33%, Kotak Mahindra Bank down by 1.24% and Apollo Hospital Ent. down by 1.19% were the top losers.

Asian markets were trading mostly in green; Hang Seng advanced 61.45 points or 0.39% to 15,940.83, Taiwan Weighted added 548.5 points or 2.94% to 18,644.57, Jakarta Composite gained 113.07 points or 1.54% to 7,322.81, Straits Times rose 20.09 points or 0.64% to 3,159.16 and Nikkei 225 surged 454.62 points or 1.19% to 38,157.94, while KOSPI dropped 6.62 points or 0.25% to 2,613.80.