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Mid & Small Caps Outperform
Wed, 28 Sep Closing

Indian equity markets continued to trade positive in the afternoon session and finished on a positive note. At the closing bell, the BSE Sensex stood higher by 69 points, while the NSE Nifty finished up by 39 points. The S&P BSE Mid Cap & the S&P BSE Small Cap finished up by 0.9% and 1.1% respectively. Gains were largely seen in metal and realty stocks.

Asian markets finished mixed as of the most recent closing prices. The Hang Seng gained 0.20%, while the Nikkei 225 & the Shanghai Composite fell 1.31% and 0.34% respectively. European markets are higher today with shares in Germany leading the region. The DAX is up 0.86% while France's CAC 40 is up 0.76% and London's FTSE 100 is up 0.67%.

The rupee was trading at 66.45 against the US$ in the afternoon session. Oil prices were trading at US$ 44.96 at the time of writing.

According to a leading financial daily, India has moved up 16 positions to rank 55th on a global index of the world's most competitive economies that lists 138 countries. This is the second year in a row that India has jumped 16 spots. The WEF ranking may also come in as a boost for the ruling government's business friendly image.

As per the reports, the rankings consider factors and institutions that determine long-term economic growth and prosperity. The areas where India ranks better were gross national savings, quality of education system, venture capital availability, hiring and firing practices, GDP and domestic market size, public trust in politicians and burden of government regulation.

For macro-economic environment, India is ranked 91st, helped by a reduction in commodity prices and improvement in the government's budget deficit. In terms of competitiveness of its institutions, India is ranked 60th (out of total 140 countries and up 10 positions from last year), while for infrastructure it has gained six places to 81st.

But even as India's overall performance looks excellent, it is ranked low on some parameters such as health and primary education (rank 85). This doesn't bode well for a country whose working-age population is estimated to be the largest in Asia-Pacific by 2050.

Moving on to news from banking sector. Shares of Yes Bank finished the trading day on an encouraging note (1.8%) after it was reported that the company will raise Rs 3.3 billion (approximately US$50 million equivalent) through an issue of a 7-year Green Infrastructure Bonds to FMO, the Dutch Development Bank, on a private placement basis. FMO will be investing in the bank's bonds through FMO's own sustainable bonds. This is FMO's first Investment in a Green Bond issued by a bank in India.

The amount raised will be used by the bank to finance Green Infrastructure including solar and wind projects in the renewable energy space. This issuance would be externally assured by a reputed third party. This is the third such green bond issuance by the bank in the last 18 months.

Similarly, State Bank of India (SBI) has also reportedly issued and allotted 25,000 AT 1 Basel III compliant non-convertible debentures (NCDs) of face value Rs 1,000,000 each at par through private placement bearing coupon of 8.75% aggregating to Rs 25 billion in second tranche.

SBI also recently raised US$300 million through the first foreign currency AT1 issuance ever by an Indian bank. The perpetual non-call 5 year deal was priced at a fixed coupon of 5.50% payable semi-annually and the first reset of the bond will be on the 6th anniversary date.

SBI finished the day up by 1.8% on the BSE.

Banking stocks finished on a firm note with Federal Bank and PNB leading the gains.

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Jan 22, 2018 (Close)