Sensex, Nifty trades marginally in green

Volatility continued  on street as key Benchmarks bounced back and were trading marginally in green after opening gap-down in early trade even as the US Federal Reserve signaled that it officials are inclined towards phase out of its massive stimulus program. The minutes of FOMC policy meet in July show that most members want to slow down the pace of a massive bond-buying program. The trade is likely to remain sideways in the near term and a pull-back rally is not ruled out. A move by the government or the Reserve Bank of India to prep up the economy and the rupee may provide support to the benchmarks. The Indian rupee pared some of the day's losses on the back of RBI intervention after it fell to historic low of 65.03 in early trade. The partially convertible rupee was at 64.70 per dollar, down 59, paise, against its previous close of 64.11.

On the global front, Asian markets too were trading mostly in the red with Malaysia’s benchmark KLSE Composite declining over one and half percent as the nation’s current account surplus plunged in the second quarter on weakening exports, overshadowing a slight acceleration in economic growth. Back home, traders were buying, Metal, Oil & Gas and PSU, while selling were seen in Realty, Banking and Power on the BSE.

Meanwhile, the benchmarks NSE Nifty and BSE Sensex were trading near the psychological 5,300 and 17,700 levels respectively. The market breadth on BSE was showing negative trend with advances to declines in the ratio of 690:795.The BSE Sensex is currently trading at 17936.87, up by 30.96 points or 0.17% after trading in a range of 18007.27 and 17759.59. There were 18 stocks advancing against 12 declines on the index. The broader indices were trading in red; the BSE Mid cap index was down by 0.28% and Small cap index down by 0.06%.

The top gaining sectoral indices on the BSE were, Metal up by 2.66%, Oil & Gas up by 1.06%, PSU up by 0.97%, Consumer Durables up by 0.83% and Health Care up by 0.58%, while Realty down by 2.14%, Bankex down by 1.01%, Power down by 0.13% and Auto down by 0.12% were the top losers on the sectoral index.

The top gainers on the Sensex were ONGC up by 4.25%, Tata Steel up by 4.25%, Sterlite Inds up by 3.03%, Tata Motors up by 2.26% and Jindal Steel up by 2.22%. On the flip side, Maruti Suzuki was down by 2.67%, Mahindra & Mahindra was down by 2.30%, NTPC was down by 1.65%, HDFC Bank was down by 1.46% and  HDFC was down by 1.27% were the top losers on the Sensex.

Meanwhile, As per the Prime Minister's key economic advisor C Rangarajan, Indian banking industry may have to deal with higher non-performing assets (NPAs) on account of poor economic performance. While addressing an event, Rangarajan said that NPA increases in the economic slowdown scenario and if rise in bad loan is beyond control of banks, then they have to be very careful in identifying NPAs and should also take note of what is happening in the current economic environment.

The stress on the asset quality is a reflection of the stress in the economy of the country and over the past two years, non-performing Assets (NPAs) of banks have been going up due to slowdown in the economy. In the June quarter, gross NPAs in the banking system grew by 12.02% to Rs.2.06 trillion and formed 3.85% of the industry’s advances. In banking industry, public sector sector banks remained the worst performers as gross non-performing assets (NPA) of public sector banks rose to Rs 1.76 lakh crore in the April-June quarter of 2013-14 from Rs 1.55 lakh crore at March 31, 2013. Gross bad assets of PSU bank-Central Bank of India exceeded 6% of its advances in the June quarter.

On the other hand, Indian economy is struggling with slowdown owing to the poor performance of farm, manufacturing and mining sectors. India’s GDP growth slowed down to a decade low of 5% in the previous fiscal.

The CNX Nifty is currently trading at 5,305.10 up by 2.55 points or 0.05% after trading in a range of 5,333.20 and 5,254.05. There were 30 stocks advancing against 20 declines on the index.

The top gainers of the Nifty were ONGC up by 4.73%, Tata Steel up by 4.45%, Sesa Goa up by 3.16%, BPCL up by 2.94% and Tata Motors up by 2.52%. On the flip side, DLF down by 4.75%, Maruti down by 3.46%, M&M down by 2.33%, NTPC down by 2.26% and HDFC Bank down by 1.86% were the major losers on the index.

Most of the Asian equity indices were trading in red; Hang Seng declined 119.95 points or 0.55% to 21,697.78, Jakarta Composite tumbled 107.56 points or 2.55% to 4,110.89, KLSE Composite crumbled 30.11 points or 1.73% to 1,714.74, Nikkei 225 shed 39.72 points or 0.30% to 13,384.61, Straits Times dropped 38.62 points or 1.24% to 3,070.37, Seoul Composite decreased 17.82 points or 0.95% to 1,849.64 and Taiwan Weighted was down by 38.37 points or 0.49% to 7,794.28.

On the flip side, Shanghai Composite was up by 1.82 points or 0.09% to 2,074.78.