Dear Trader…
Indian equity benchmarks ended on a flat note for second straight session on Thursday. After making cautious start, markets gained momentum as traders took some support with finance minister Nirmala Sitharaman’s statement that State-run banks will undertake a nation-wide loan outreach programme around October, as the government seeks to stir economic growth through sustained credit push, especially to Covid-hit small and medium businesses, retail and farm sectors, amid fears that bankers have turned risk-averse.
However, markets erased initial gains and turned volatile in second half of the session, as traders turned cautious with rating agency Moodys stating that India's second Coronavirus (Covid-19) wave is increasing asset risks for banks in retail and the SME loan segment. However, factors like tight credit underwriting, strong loss provisions will help banks withstand pressures and prevent a sharp rise in bad loans.
Nifty futures opened at 16612.10 points against the previous close of 16632.35 and opened at a low of 16572.30 points. Nifty Future closed with an average movement of 99.60 points and a rise of around 6.60 points and 16638.95 points...!!!
On the NSE, the midcap 100 index will rise 0.19% and smallcap 100 index is closing rise 0.24. Speaking of various sectoral indices, the NSE saw gains in FMCG, Realty, Bank and Finance Service, while all other sectoral indices closed lower.
At the start of intra-day trading, October gold opened at Rs.47181, fell from a high of Rs.47229 points to a low of Rs.47050.00 with a decline of 119 points, a trend of around Rs.47060 and September Silver opened at Rs.63021, fell from a high of Rs.63289 points to a low of Rs.62545, with a decline of 664 points, a trend of around Rs.62608.
Meanwhile, Union Finance Minister Nirmala Sitharaman has requested banks to work with all State governments to push the 'one district, one product' agenda, while advising public-sector banks (PSB) to adopt a nationwide credit outreach programme this year.
Sitharaman said banks have also been requested to have interaction with export promotion agencies, chambers of commerce and industry to understand and address the requirement of exporters on a timely manner. She said between public-sector banks (PSBs), there should be some kind of a simple approach so that exporters are not made to run between one bank to another scouting for a better offer.
Banks should go about to exhibit loan offerings in every district of the country in a bid to enhance the credit demand.A similar outreach programme was undertaken by the PSBs in which some private-sector banks also participated to boost credit offtake in the face of an economic slowdown. She said ‘With changed times, now industries have option of raising funds even from outside the banking sector. Banks themselves are raising funds through various avenues. These new aspects need to be studied to target credit where it is needed.
Technically, the important key resistances are placed in Nifty future are at 16676 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 16707 – 16737 levels. Immediate support is placed at 16577 – 16505 levels.
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