Benchmarks pare gains; trade continues in green

Indian equities pared gains but continued to trade in green, hovering above neutral line in the late afternoon session. The weakness was on account of profit booking and taking cues from weak European counterparts.  Though, the sentiments were on optimistic side from the early trade after Goldman Sachs upgraded Indian equities to ‘overweight’ from ‘marketweight’ and raised its target on Nifty to 7,600, citing reduced external vulnerabilities, including a narrowing current account deficit, and potential for gains ahead of elections that conclude in May, but profit booking at higher levels dragged the markets lower. Traders were seen piling positions in PSU, Oil & Gas and FMCG stocks, while selling was witnessed in Realty, IT and Capital Goods sector stocks. In scrip specific development, Maruti Suzuki India was trading in green after the company decided to seek minority shareholders’ approval for the controversial Gujarat plant. Orchid Chemicals and Pharmaceuticals was locked at upper circuit limit on receiving approval for its debt restructuring package. SREI Infrastructure was trading firm after Reliance Jio entered into infrastructure sharing agreement with Viom Networks. SREI own 18 percent and control management of Viom Networks.

On the global front, the Asian markets barring Jakarta Composite and Straits Times were trading in green, while the European markets were trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,500 and 21,800 levels respectively. The market breadth on BSE was positive in the ratio of 1383:1226 while 180 scrips remained unchanged.

The BSE Sensex is currently trading at 21811.89 up by 2.09 points or 0.01% after trading in a range of 22040.72 and 21811.89. There were 15 stocks advancing against 15 declines on the index.

The broader indices were outperforming the benchmarks; the BSE Mid cap index was up by 0.75% and Small cap index was up by 0.62%.

The top gaining sectoral indices on BSE were, PSU up by 1.50%, Oil & Gas up 1.35%, FMCG up by 1.24%, Power up by 1.02% and Metal was up by 0.52%, while Realty down by 1.17%, IT down by 0.63%, Capital Goods down by 0.58%, TECK down by 0.35% and Auto down by 0.12% were the losers on the sectoral index.

The top gainers on the Sensex were Maruti Suzuki up by 7.84%, Coal India up by 2.33%, SBI up by 2.21%, ONGC up by 1.94% and ITC up by 1.84%.

On the flip side, Tata Motors down by 2.45%, HDFC down by 1.60%, L&T down by 1.55%, Mahindra & Mahindra down by 1.31% and Wipro down by 1.01% were the top losers on the Sensex.

Meanwhile, Micro Finance Institutions Network (MFIN), the registered body of micro-finance companies, has sought for the Reserve Bank of India’s (RBI) approval to become the first self-regulatory organisation (SRO) for microfinance institutions. Besides filing a formal application, the MFIN has also completed necessary structural changes in its management.  The association has inducted three independent directors on the board and by June, the association would have 12 board directors including four independent directors. Further, MFIN has put in place all necessary requirements according to the norms.

Last month, the RBI released guidelines to recognize industry associations as self-regulatory organisations (SROs) of non-banking financial companies that are engaged in micro finance (NBFC-MFIs) based on the recommendations made by the Y H Malegam committee. The Malegam panel was set up by the apex bank to look into regulatory aspects of micro-lending following the Andhra Pradesh microfinance crisis of 2010.

The central bank, in its notification, had stated that in order to become an SRO, the association will have to adhere to a set of functions and responsibilities such as formulating and administering a code of conduct, ensuring borrower protection, having a grievance and dispute redressal mechanism for clients, monitoring compliance by NBFC-MFIs with the regulatory framework, and submission of its financials and annual report among others. RBI further notified that an industry body should have independent directors comprising at least a third of its board, and representation of both small and large micro-lenders on the governing council. 

The CNX Nifty is currently trading at 6,506.70 up by 2.50 points or 0.04% after trading in a range of 6,574.95 and 6,505.60. There were 26 stocks advancing against 24 declines on the index.

The top gainers of the Nifty were Maruti was up by 7.69%, Jindal Steel was up by 2.64%, IndusInd Bank up by 2.49%, SBI up by 2.20% and Coal India up by 2.16%.

On the flip side, Tata Motors down by 2.44%, DLF down by 2.43%, JP Associates down by 1.86%, HDFC down by 1.62% and L&T down by 1.45% were the top losers on the index.

The Asian equity indices were trading mostly in green; Shanghai Composite was up by 0.08%, KLSE Composite was up by 0.26%, Hang Seng added 0.51%, Nikkei 225 gained 0.94%, Seoul Composite was up by 0.66% and Taiwan Weighted added 0.37%. On the other hand Jakarta Composite lost 1.31% and Straits Times lost 0.19%.

The European markets were trading in red; France’s CAC 40 was down 0.28%, Germany’s DAX dropped 0.64% and UK’s FTSE 100 slipped 0.38%.