Dear Trader…
Indian markets have strengthened further, showing a steady trade with gaining momentum in today session. The Sensex was above 57200 mark, the Nifty50 was close above its crucial support level of 17000, supported by gains in healthcare, industrials, and capital goods stocks. Traders were encouraged as a member of the Monetary Policy Committee (MPC) of the Reserve Bank, Jayanth R Varma expressed hope that in a few quarters from now, capital investment would begin to pick up even in the old economy, and said the next fiscal year is also expected to witness a decent growth.
However, there was some cautiousness as country’s foreign exchange reserves declined by $160 million to stand at $635.667 billion in the week to December 17. During the reporting week ended December 17, the dip in the forex kitty was on account of a decline in foreign currency assets (FCAs), a major component of the overall reserves.
Nifty futures opened at 16950.00 points against the previous close of 17003.80 and opened at a low of 16842.40 points. Nifty Future closed with an average movement of 286.60 points and a rise of around 114.20 points and 17118.00 points...!!
On the NSE, the midcap 100 index will rise 0.44% and smallcap 100 index is closing rise 0.20%. Speaking of various sectoral indices only Media, FMCG and Metal stocks were seen selling on the NSE, while all other sectoral indices closed higher.
At the start of intra-day trading, February gold opened at Rs.48119, fell from a high of Rs.48248 points to a low of Rs.48051 with a decline of 39 points, a trend of around Rs.48080 and March Silver opened at Rs.62187, fell from a high of Rs.62240 points to a low of Rs.61753, with a decline of 479 points, a trend of around Rs.61819.
Meanwhile, rating agency ICRA has said that the recent improvement in recovery of the non-performing assets (NPAs) and decline in provisioning of loans in the banking sector are expected to improve further in the coming year. Accordingly, it said the improvement in such parameters has helped realise better profitability for the banks. However, subdued credit growth and surplus liquidity continue to be a drag on the profit margins for the sector.
Anil Gupta, Vice-President and Sector Head at ICRA said ‘The banking sector navigated well during 2022, despite the challenges posed by the second wave of Covid-19... Even in the absence of relief measures such as moratorium on loan repayments or standstill on NPA classification, which were allowed during the first wave, banks were able to reduce their NPAs’.
For small finance banks (SFBs), the Covid-19 pandemic significantly impacted the performance during FY21 and H1FY22 in terms of growth, asset quality and profitability. The rating agency expects the SFB sector to witness improvement in asset under management growth in FY22 as compared with FY21, but the asset quality metrics are expected to remain weak, which would thereby keep credit costs elevated and hence profitability subdued.
Technically, the important key resistances are placed in Nifty future are at 17177 levels, which could offer for the market on the higher side. Sustainability above this zone would signal opens the door for a directional up move with immediate resistances seen at 17202 – 17232 levels. Immediate support is placed at 17007 – 16970 levels.
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