Markets add more gains in late morning deals

Domestic equity induces added more gains in late morning deals as market participants indulged in enlarging their positions. Sensex surged over 500 points, while Nifty gained over 150 points. Meanwhile, broader indices were also trading in green with BSE Mid cap index and Small cap index gaining in the range of 0.65-0.95%. Positive cues from the global markets supported domestic sentiments. Further, support also came in as rating agency ICRA said it expects sequential revenue growth for India Inc in the December quarter, led by improved rural demand and uptick in government spending, additionally supported by the festival season. On the BSE sectoral front, traders were seen pilling up positions in PSU, Bankex, Industrials, Oil & Gas and Capital Goods, while selling was witnessed in FMCG, Realty and Consumer Durables. 

On the global front, Asian markets were trading mostly in green as traders remained optimistic about an interest rate cut by the US Fed in December after remarks from Fed Governor Christopher Waller that he is leaning toward a December rate cut. Back home, in the stock specific development, Safari Industries surged after the company’s wholly-owned subsidiary, Safari Manufacturing, has successfully commenced its commercial production/manufacturing of luggage on December 2, 2024 at its newly set up greenfield manufacturing facility at Jaipur, Rajasthan.

The BSE Sensex is currently trading at 80794.40, up by 546.32 points or 0.68% after trading in a range of 80244.78 and 80828.85. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.68%, while Small cap index up by 0.94%.

The top gaining sectoral indices on the BSE were PSU up by 1.23%, Bankex up by 1.22%, Industrials up by 1.21%, Oil & Gas up by 1.16% and Capital Goods up by 1.08%, while FMCG down by 0.67%, Realty down by 0.25% and Consumer Durables down by 0.12% were few losing indices on BSE.

The top gainers on the Sensex were Adani Ports up by 5.48%, SBI up by 2.25%, Larsen & Toubro up by 1.98%, Ultratech Cement up by 1.76% and Axis Bank up by 1.65%. On the flip side, ITC down by 1.76%, Bharti Airtel down by 0.89%, Sun Pharma down by 0.53%, Kotak Mahindra Bank down by 0.40% and Asian Paints down by 0.27% were the top losers.

Meanwhile, domestic rating agency Crisil in its latest report has said that Reserve Bank of India’s (RBI) regulatory initiatives and asset quality trends will push non-banking financial companies (NBFCs) to slow down their growth in asset under management (AUM) to 15-17 per cent in the current fiscal and next. The sector had achieved a handsome growth of 23 per cent in the AUM in FY24, and even with the slower growth, the AUM expansion will be higher than the 14 per cent of the last decade.

According to the report, entities will opt for ‘sustainable growth’ because of the regulatory environment and asset quality trends, and the present situation will lead to recalibration in strategies. It said RBI had in November last year increased the risk weights on banks' lending to NBFCs along with the lending to unsecured loans, where NBFCs are very active. Additionally, the micro loan segment is also showing signs of stress on asset quality lately.

The report said rising concerns around household indebtedness and asset quality risks will have a bearing on growth strategies in specific retail asset segments such as microfinance and unsecured loans. It noted that intensified regulatory actions on compliance focused on customer protection, pricing disclosures and operational compliance will necessitate the process of recalibration. Even as the overall AUM growth will slow down, the growth in the AUM of the largest contributors of home loans and vehicle loans, constituting 45 per cent of the segment, will have a limited impact as it will be driven by fundamentals. The unsecured loans and microfinance segments, accounting for 23 per cent of the overall NBFC AUM, are expected to be impacted the most.

The CNX Nifty is currently trading at 24432.05, up by 156.00 points or 0.64% after trading in a range of 24280.00 and 24439.15. There were 35 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were Adani Ports up by 5.50%, ONGC up by 2.58%, Cipla up by 2.55%, SBI up by 2.25% and Adani Enterprises up by 2.14%. On the flip side, ITC down by 1.75%, Trent down by 1.30%, HDFC Life Insurance down by 0.91%, Bharti Airtel down by 0.85% and Sun Pharma down by 0.58% were the top losers.

Asian markets were trading mostly in green; Hang Seng advanced 12.04 points or 0.06% to 19,562.33, Jakarta Composite gained 102.18 points or 1.43% to 7,149.17, Straits Times rose 41.12 points or 1.1% to 3,792.47, KOSPI increased 44.91 points or 1.83% to 2,499.39, Nikkei 225 surged 822.41 points or 2.14% to 39,335.43 and Taiwan Weighted added 290.53 points or 1.28% to 23,027.46. However, Shanghai Composite weakened 9.44 points or 0.28% to 3,354.54.