INDICES TRADE SIDEWAYS; BANK SHARES SLIP FOR 2ND DAY

The key equity benchmarks continued to trade near the flat line in the mid-morning trade. The Nifty traded above the 19,750 mark. Bank shares extended losses for the second consecutive trading session.

At 10:25 IST, the barometer index, the S&P BSE Sensex, was down 72.56 points or 0.11% to 65,909.92. The Nifty 50 index rose 2.15 points or 0.01% to 19,767.35.

The broader market outperformed the headline indices. The S&P BSE Mid-Cap index gained 0.26% while the S&P BSE Small-Cap index rose 0.45%. The S&P BSE Mid-Cap index and S&P BSE Small-Cap index hit record high of 33,423.33 and 39,689.94 in intraday today.

The market breadth was positive. On the BSE, 2,040 shares rose and 1,501 shares fell. A total of 161 shares were unchanged.

Economy:

Reserve Bank of India or RBI has announced some regulatory measures towards consumer credit and bank credit to NBFCs. The high growth seen in consumer credit and increasing dependency of NBFCs on bank borrowings were highlighted by Governor in the interactions with MD/CEOs of major banks and large NBFCs in July and August 2023, respectively.

The central bank noted that as per extant instructions applicable to commercial banks, consumer credit attracts a risk weight of 100%. On a review, it has been decided to increase the risk weights in respect of consumer credit exposure of commercial banks (outstanding as well as new), including personal loans, but excluding housing loans, education loans, vehicle loans and loans secured by gold and gold jewellery, by 25 percentage points to 125%.

Buzzing Index:

The Nifty Bank index fell 1.05% to 43,695.70. The index declined 1.14% in the past two sessions.

IDFC First Bank (down 3.39%), State Bank of India (down 3.07%), Axis Bank (down 3.04%), Punjab National Bank (down 2.7%) and Bandhan Bank (down 1.85%), Bank of Baroda (down 1.13%), ICICI Bank (down 0.68%), Federal Bank (down 0.57%), HDFC Bank (down 0.3%) and IndusInd Bank (down 0.28%) declined.

On the other hand, AU Small Finance Bank (up 0.73%), Kotak Mahindra Bank (up 0.07%) advanced.

Global Markets:

Asian stocks were trading mixed on Friday as a batch of softer U.S. economic data took some of the steam out of Wall Street, but also boosted bonds in a big way while slugging oil prices in a boon for the inflation outlook. Both Brent and U.S. crude slid almost 5% on Thursday to four-month lows in a move that was blamed on economic and supply concerns.

In US, the S&P 500 and the Nasdaq managed to eke out tiny gains on Thursday while the Dow Industrial Average ended slightly lower with pressure from tech and retail bellwethers Cisco and Walmart after disappointing forecasts. Shares of Cisco Systems tumbled as the communications and networking technology company cut its full-year revenue and profit forecasts on slowing demand for its networking equipment.

U.S. President Joe Biden and Chinese President Xi Jinping have agreed to resume high-level military communication, according to both countries. The two leaders met in person for the first time in a year Wednesday in San Francisco on the sidelines of the Asia-Pacific Economic Cooperation conference. �We�re back to direct, open, clear communications,� Biden said at a press conference after the talks. 

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