Benchmarks continue to trade marginally in green in morning deals

Indian equity benchmarks continued to trade marginally in green in morning deals, driven by strong gains in Metal, Basic Materials and IT stocks. Traders took some support with the finance ministry stating that the Centre has retained its borrowing target for the current financial year and plans to raise Rs 6.61 lakh crore through auction of dated securities during October-March period of 2024-25 to fund the revenue gap to boost economic growth. Traders took a note of former RBI Governor Raghuram Rajan’s statement that India has done well in areas like infrastructure in the last 10 years, but it also needs to do more in other sectors to boost local manufacturing and job creation. Rajan further said the government's focus on production, whether it is goods or services is a good thing, but it is also important to do it the right way. Sector-wise, banking stocks remained in limelight as CareEdge Ratings said net Non-Performing Assets (NNPAs) of scheduled commercial banks (SCB) saw a sharp decline, reducing by 24.9 per cent y-o-y to Rs 1 lakh crore as of June 30, 2024. On the global front, Asian markets are trading mostly in green as risk appetite across financial markets got a further boost from China’s latest stimulus measures and as US benchmarks hit fresh records.

The BSE Sensex is currently trading at 85931.77, up by 95.65 points or 0.11% after trading in a range of 85787.61 and 85966.03. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.32%, while Small cap index was up by 0.47%.

The top gaining sectoral indices on the BSE were Metal up by 1.73%, Basic Materials up by 1.13%, IT up by 1.10%, Oil & Gas up by 1.01% and PSU up by 0.93%, while Realty down by 0.88%, Bankex down by 0.04%, Telecom down by 0.03% and Capital Goods down by 0.02% were the top losing indices on BSE.

The top gainers on the Sensex were Titan Company up by 1.79%, Tata Steel up by 1.72%, Indusind Bank up by 1.44%, Infosys up by 1.35% and Sun Pharma up by 1.33%. On the flip side, Power Grid Corporation down by 1.72%, Larsen & Toubro down by 1.44%, Bharti Airtel down by 1.21%, Kotak Mahindra Bank down by 0.63% and HDFC Bank down by 0.49% were the top losers.

Meanwhile, CareEdge Ratings has said that Net Non-Performing Assets (NNPAs) of scheduled commercial banks (SCB) saw a sharp decline, reducing by 24.9 per cent y-o-y to Rs 1 lakh crore as of June 30, 2024 (Q1FY25). The gross non-performing assets (GNPAs) of scheduled commercial banks (SCBs) fell by 15.2 per cent year-on-year (y-o-y) to Rs 4.57 lakh crore as of Q1FY25, compared to Rs 5.66 lakh crore in the same period last year.

It stated the GNPA ratio now stands at 2.8 per cent, a reduction from 3.8 per cent a year ago. This drop is primarily due to lower slippages, higher recoveries, and steady write-offs over the last year. The Indian banking sector has continued its positive trajectory with reductions in both gross and net non-performing assets NPAs for SCBs as of June 30, 2024. The NNPA ratio has reached an all-time low of 0.6 per cent, down from 1.0 per cent in Q1FY24.

Despite this, the decline in NNPAs within SCBs varied, as private banks (PVBs) witnessed a marginal increase of 3 basis points (bps) in their NNPA ratio, driven by seasonal collection weaknesses and higher retail delinquencies, leading to a current NNPA ratio of 0.46 per cent. Private sector banks (PSB), in particular, have managed to bring down their incremental provisioning levels due to consistent asset quality improvements. They have contributed to the overall improvement in the banking sector’s asset quality.

The CNX Nifty is currently trading at 26261.90, up by 45.85 points or 0.17% after trading in a range of 26208.90 and 26271.85. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 2.93%, BPCL up by 2.65%, Titan Company up by 1.81%, Tata Steel up by 1.73% and Indusind Bank up by 1.41%. On the flip side, Power Grid Corporation down by 1.79%, Larsen & Toubro down by 1.47%, Bharti Airtel down by 1.27%, Divi's Lab down by 0.77% and Dr. Reddy's Lab down by 0.75% were the top losers.

Asian markets are trading mostly in green; Hang Seng advanced 697.32 points or 3.38% to 20,621.90, Shanghai Composite strengthened 64.34 points or 2.1% to 3,065.29, Nikkei 225 surged 568.04 points or 1.46% to 39,493.67 and Taiwan Weighted added 19.6 points or 0.09% to 22,878.41.

On the flip side, Straits Times fell 15.7 points or 0.44% to 3,566.53, KOSPI dropped 5.38 points or 0.2% to 2,666.19 and Jakarta Composite plunged 51.75 points or 0.67% to 7,692.77.