The Indian markets continued to trade well above the dotted line during the late morning and post noon trading sessions. The BSE-Sensex is trading higher by about 130 points or 0.6%, while the NSE-Nifty is trading higher by about 46 points or 0.8%. Barring stocks from the oil & gas space, buying activity is being witnessed across the board with stocks from the healthcare and capital goods sectors being the most preferred. Mid and smallcaps are also in demand with their respective indices trading higher by about 0.9% and 1% respectively.
Asian markets are trading mixed with China and Japan down by about 0.6% and 0.04%, while Hong Kong is trading higher by about 0.5%. The rupee was trading at Rs 62.04 to the dollar at the time of writing.
Banking stocks are trading firm with Axis Bank, ICICI Bank and Yes Bank being the top performers. As per a leading financial daily, the country's largest lender State Bank of India will raise up to Rs 95.8 bn (US$ 1.53 bn) through a share sale to institutional investors or a follow-on public offer (FPO). SBI plans to raise another Rs 20 bn through sale of shares to the government on a preferential basis. SBI reported 35.07% year on year decline in profits while total income of the company increased by 12.88% YoY. The former was the sharpest quarterly profit decline in more than two years as the non - performing loans have been increasing. As such, the lender is under pressure to raise the funds quickly.
Power stocks are trading firm led by Reliance Power, JSW Energy and Adani Power. As reported by the Economic times, the government is looking to help the ailing private sector power companies in the form of restructuring loans, extending repayments deadlines and waiving penalties. These efforts are being made to help companies that have been struggling with rising debt levels and other issues that largely seem to be out of their control. These include the fuel supply issues, distribution related bottlenecks, increasing working capital requirements, delays in clearances, amongst others. This proposal is likely to benefit companies plants with capacities of 65 to 70 GW that have been stuck due to many reasons, not limited to the ones mentioned above. In addition, this move would also help banks to prevent loans from becoming non-performing assets (NPAs). While this would be a positive move for the power companies, the impact of these will seen after a while since execution of these measures is what will be the key.