Weak trade persisted over the Dalal Street in late morning session, with both Sensex and Nifty trading in deep red. Negative cues from other Asian markets impacted domestic sentiments. Traders got cautious, amid a private report stating that there has been an over 28 per cent increase in suspected fraudulent digital transaction attempts against businesses originating from India in the pandemic year. The street took a note of report that markets regulator Sebi said mutual funds will have to make a disclosure about scheme risk-o-meter, performance and portfolio details to investors only for the particular plans in which they have invested.
On the global front, Asian markets were trading mostly in red, even after China's manufacturing sector grew at the fastest pace in four months in April. The survey results from IHS Markit showed that the Caixin manufacturing Purchasing Managers' Index rose to 51.9 in April from an 11-month low of 50.6 in March. A score above 50 indicates expansion in the sector. Driven by improved market conditions and greater customer demand, total new orders grew for the eleventh straight month in April.
The BSE Sensex is currently trading at 49338.91, down by 427.03 points or 0.86% after trading in a range of 49229.51 and 49569.42. There were 12 stocks advancing against 18 stocks declining on the index.
The broader indices were trading in green; the BSE Mid cap index was up by 0.13%, while Small cap index was up by 0.49%.
The top gaining sectoral indices on the BSE were Oil & Gas up by 3.44%, PSU up by 2.00%, Utilities up by 1.41%, Energy up by 1.06% and Power up by 0.56%, while Bankex down by 1.25%, FMCG down by 0.59%, Realty down by 0.44%, Auto down by 0.40% and Consumer discretionary down by 0.33% were the top losing indices on BSE.
The top gainers on the Sensex were ONGC up by 6.63%, NTPC up by 1.84%, Dr. Reddy’s Lab up by 0.92%, Axis Bank up by 0.69% and Infosys up by 0.66%. On the flip side, HDFC Bank down by 3.31%, HDFC down by 2.52%, Hindustan Unilever down by 2.36%, Asian Paints down by 1.93% and ICICI Bank down by 1.92% were the top losers.
Meanwhile, Care Ratings in its latest report has said the second wave of COVID-19 to adversely affect asset performance of non-banking finance companies (NBFCs) with credit costs are likely to remain high in FY22. However, it said the impact is expected to be lesser in low-risk retail secured loan book, while more in the high-risk unsecured lending business. The report said asset quality metrics across the sector is expected to remain supported in FY21 by the Reserve Bank of India's restructuring schemes, moratorium announced from March 2020 to August 2020 and economic revival post-September 2020.
For FY22, the agency expects some level of stress, especially in the loan portfolio under restructuring and those which were under moratorium. The agency said its baseline scenario assumes that lockdowns will start easing from end-May. Also, the likelihood of support from the government or regulatory authorities have not been taken into consideration. For housing finance companies (HFCs), credit cost is expected to reduce going forward as the mortgage lenders have already made more than sufficient provisioning in the last couple of years and the business remains resilient. It expects HFC's credit cost to at 0.7 per cent in FY21 and 0.3 per cent in FY22.
As per the report, credit cost for Commercial Vehicle (CV) finance segment will increase marginally to 2.2 per cent in FY22 from the expected 1.9 per cent in FY21. The agency said the microfinance segment will see credit cost moderating to 5 per cent in FY22 compared to an estimate of 6.5 per cent in FY21. Microfinance has proven to be a resilient asset class as demonstrated in the past. Furthermore, a large proportion of the overall portfolio (close to 75 per cent) is in rural areas and catering to essential services. Gold loans have seen minimal COVID-19 impact due to the liquid nature of the collateral. The segment credit cost is likely to be 0.3 per cent in the current year as against an expectation of 0.4 per cent in FY21.
The CNX Nifty is currently trading at 14794.75, down by 100.15 points or 0.67% after trading in a range of 14730.75 and 14855.45. There were 22 stocks advancing against 28 stocks declining on the index.
The top gainers on Nifty were ONGC up by 6.58%, Coal India up by 3.87%, Indian Oil Corp. up by 3.82%, BPCL up by 3.72% and Divis Lab up by 2.89%. On the flip side, HDFC Bank down by 3.35%, HDFC down by 2.88%, Hindustan Unilever down by 2.32%, ICICI Bank down by 2.00% and Asian Paints down by 1.94% were the top losers.
Asian markets were trading mostly in red; Nikkei 225 declined 280.39 points or 0.97% to 28,773.58, Hang Seng fell 447.00 points or 1.53% to 28,856.26, KOSPI slipped 17.70 points or 0.56% to 3,156.37, Jakarta Composite lost 21.40 points or 0.36% to 5,991.56 and Shanghai Composite was down by 17.81 points or 0.51% to 3,457.09, while Straits Times added 10.10 points or 0.31% to 3,231.68.