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Indian equities hold gains in afternoon session
Aug-19-2019

Indian equity benchmarks hold their gains of more than half percent in afternoon session on sustained buying by domestic institutional investors amid positive global cues. Sentiments remain up-beat with Fitch Solutions’ statement that the RBI is expected to cut interest rates by 40 basis points before the end of the current financial year as monetary easing till now appears to be insufficient in boosting economic growth. Traders also took a note of Corporate Affairs Secretary Injeti Srinivas stating that the government is planning to give debt waiver for small distressed borrowers as part of 'Fresh Start' provisions under the Insolvency and Bankruptcy Code (IBC) framework. On the sectoral front, Airline sector remained in focus with report that aviation watchdog DGCA is looking at the option of introducing a new pilots training programme that will focus more on competitive assessment rather than just fixed flying hours.

On the global front, Asian stocks were trading in green, as hopes of more stimulus from central banks around the world and steps being taken by major economies such as Germany and China soothed investors’ fears of a sharp global economic slump. Back home, the BSE Sensex is currently trading at 37671.50, up by 321.17 points or 0.86% after trading in a range of 37420.52 and 37682.92. There were 24 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.56%, while Small cap index was up by 0.61%.

The top gaining sectoral indices on the BSE were Capital Goods up by 1.39%, Consumer Durables up by 1.39%, Healthcare up by 1.36%, Realty up by 1.20% and Telecom was up by 1.05%, while PSU down by 0.38% and Oil & Gas was down by 0.01% were the only losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 3.29%, Larsen & Toubro up by 1.78%, ICICI Bank up by 1.71%, NTPC up by 1.53% and ITC was up by 1.46%. On the flip side, Yes Bank down by 1.70%, Power Grid down by 1.51%, SBI down by 0.96%, Tata Steel down by 0.69% and ONGC was down by 0.66% were the top losers.

Meanwhile, Corporate Affairs Secretary Injeti Srinivas has said that the government is planning to give debt waiver for small distressed borrowers as part of 'Fresh Start' provisions under the Insolvency and Bankruptcy Code (IBC) framework. He said the government has held discussions with the microfinance industry regarding criteria for the proposed waiver for small distressed borrowers from the economically weaker section (EWS). He emphasized that the waiver-as part of individual insolvency-would be for the most distressed within the EWS.

Srinivas said 'If you have once availed the fresh start, then you cannot avail it again for five years. We have worked out all safeguards to the satisfaction of the microfinance industry. It will be like taking haircuts. At a national level, over a three to four years period, it will be not more than Rs 10,000 crore.' He further said that the IBC provisions pertaining to personal guarantor to corporate debtor would be coming into effect immediately, followed by those related to partnership and proprietorship. He said 'then we will look to bring fresh start provision.' 

As per the IBC, there are various thresholds for 'fresh start', including that the gross annual income of the debtor does not exceed Rs 60,000. The aggregate value of the debtor's assets should not be more than Rs 20,000 and that the aggregate value of the qualifying debts does not exceed Rs 35,000. Among others, such a person should not be having an own dwelling unit, irrespective of whether it is encumbered or not.

The CNX Nifty is currently trading at 11130.20, up by 82.40 points or 0.75% after trading in a range of 11068.65 and 11139.55. There were 31 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Bharti Infratel up by 3.27%, Sun Pharma up by 3.23%, Dr. Reddys Lab up by 2.13%, Larsen & Toubro up by 1.79% and NTPC was up by 1.66%. On the flip side, Yes Bank down by 2.27%, Indiabulls Housing Finance down by 1.59%, Power Grid down by 1.47%, SBI down by 1.15% and Tata Steel was down by 1.12% were the top losers.

Asian stocks were trading in green; Hang Seng increased 601.03 points or 2.34% to 26,335.25, Taiwan Weighted strengthened 67.86 points or 0.65% to 10,488.75, Jakarta Composite soared 17.26 points or 0.27% to 6,303.92, Nikkei 225 surged 144.35 points or 0.71% to 20,563.16, Shanghai Composite gained 55.34 points or 1.96% to 2,879.16, KOSPI rose 12.73 points or 0.66% to 1,939.90 and Straits Times was up by 20.32 points or 0.65% to 3,135.35.

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