Benchmarks trade jubilantly in early deals

Indian equity benchmarks have made a gap-up opening and are trading jubilantly in early deals on Monday, as investors opted to buy beaten down but fundamentally strong stocks after two days of drubbing. There was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too equally participated in the rally. Buying in auto space too supported the sentiments with most of the companies releasing better-than-expected monthly sales data for April. Meanwhile, Traders will be eyeing the HSBC India Manufacturing PMI, slated to be announced today for more cues about the economy.

On the global front, the US markets ended with good gains in last session despite mixed set of economic data. While, the manufacturing in April held at the weakest pace in almost two year, the consumer confidence increased in April to the second-highest level in more than eight years. The Asian markets were trading mostly in the green despite weak manufacturing data from China.

Back home, none of the sectoral indices were trading in the red, while realty and consumer durables witnessed the maximum gain in trade. Oil and gas, healthcare, PSU, metal, FMCG and software too were trading significantly. The broader indices too were trading with traction, while the market breadth on the BSE was positive; there were 1513 shares on the gaining side against 405 shares on the losing side while 65 shares remain unchanged.

The BSE Sensex is currently trading at 27283.92, up by 272.61 points or 1.01% after trading in a range of 27159.45 and 27386.60. There were 29 stocks advancing against 1 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.53%, while Small cap index gained 1.22%.

The top gaining sectoral indices on the BSE were Realty up by 2.07%, Consumer Durables up by 1.88%, Oil & Gas up by 1.37%, Healthcare up by 1.35% and PSU up by 1.18%, while there were no losers on the index.

The top gainers on the Sensex were ONGC up by 3.41%, Mahindra & Mahindra up by 2.87%, Hindalco up by 2.29%, Bajaj Auto up by 2.17% and Dr. Reddys Lab up by 1.91%. On the flip side, Tata Motors down by 1.35% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) has levied a penalty of Rs 1.5 crore each on three banks-- Dena Bank, Oriental Bank of Commerce and Bank of Maharashtra-- for violation of Know Your Customer (KYC) and non adherence of RBI norms on fund transfer, transactions and opening of fixed deposits. In aggregate, three banks have to pay Rs 4.5 crore fine for failing to comply with the guidelines.

Besides, India’s central bank also has warned eight other PSBs Central Bank of India, Bank of India, Punjab and Sind Bank, Punjab National Bank, State Bank of Bikaner & Jaipur, UCO Bank, Union Bank of India and Vijaya Bank-to put in place appropriate measures and review them from time to time to ensure strict compliance of KYC requirements in future.

India’s central bank’s penal action was based on the basis of complaint received from a private organization, while the fine imposed is on basis of deficiencies in regulatory compliance. The RBI, based on the complaints received, a wider thematic review was conducted and in all 12 branches of 11 public sector banks were covered.

The scrutiny revealed alleged frauds involving accounts of certain organizations in these banks, deficiencies or irregularities while opening Fixed Deposits (FDs) and extending Overdraft (OD) facility there against. Besides, RBI also found involvement of middlemen or intermediaries in opening of the accounts as also subsequent operations in those accounts. It was based on these finding, RBI issued show cause notices to 11 banks.

The CNX Nifty is currently trading at 8260.95, up by 79.45 points or 0.97% after trading in a range of 8220.45 and 8292.65. There were 45 stocks advancing against 5 stocks declining on the index.

The top gainers on Nifty were ONGC up by 3.67%, Mahindra & Mahindra up by 3.24%, Hindalco up by 2.76%, Bajaj Auto up by 2.75% and Dr. Reddys Lab up by 2.15%. On the flip side, Kotak Mahindra Bank down by 1.47%, Tech Mahindra down by 0.66%, Tata Motors down by 0.21%, IDFC down by 0.12% and Larsen & Toubro down by 0.06% were the top losers.

Asian markets were trading mostly in the green; KOSPI Index increased 5.88 points or 0.28% to 2,133.05, Nikkei 225 rose 11.62 points or 0.06% to 19,531.63, Taiwan Weighted gained 22.73 points or 0.23% to 9,842.78, Shanghai Composite jumped 37.55 points or 0.85% to 4,479.20, Jakarta Composite surged 78.39 points or 1.54% to 5,164.82 and Hang Seng was up by 105.74 points or 0.38% to 28,238.74.

On the flip side, FTSE Bursa Malaysia KLCI decreased 24.66 points or 1.34% to 1,818.27 and Straits Times was down by 4.39 points or 0.13% to 3,483.00.