Benchmarks add gains; Sensex surpasses 27000 mark

Indian equity benchmarks added gains and are trading firm hovering near the highest point of the day in the late afternoon session on account of buying in frontline blue chip counters taking cues from global counterparts as Brexit fears have slowly started to subside. The sentiments were on upbeat note after the Cabinet cleared the recommendations of the 7th Pay Commission according to which the overall hike in salary and allowance of central government employees and pensioners comes to 23.5%. Traders were seen piling position in Power, Realty and Bankex sector stocks. In scrip specific development, Uttam Galva Steels was trading firm on reports that the company may soon be put on the block. The company has been reeling under debt of around Rs 4,600 crore including working capital and had been earlier directed by lenders to rope in an investor. Majesco was trading in green after the company announced signing strategic partnership with iSIGN Solutions Inc, a supplier of electronic signature and other software solutions. The market may remain volatile today as traders may roll over positions in the Futures & Options (F&O) segment from the near month i.e. June 2016 series to next month i.e. July 2016 series. The near month June 2016 derivatives contracts will expire today i.e. June 30, 2016.

On the global front, the Asian markets were trading mostly in green while the European markets were trading mostly on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,250 and 27,000 levels respectively. The market breadth on BSE was positive in the ratio of 1616:878 while 194 scrips remained unchanged.

The BSE Sensex is currently trading at 27036.72, up by 296.33 points or 1.11% after trading in a range of 26872.59 and 27038.23. 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 1.12%, while Small cap index up by 0.97%.

The gaining sectoral indices on the BSE were Power up by 1.81%, Realty up by 1.66%, Bankex up by 1.57%, Auto up by 1.28% and FMCG up by 1.23%.

The top gainers on the Sensex were NTPC up by 3.10%, Dr. Reddy’s Lab up by 2.91%, Axis Bank up by 2.81%, Tata Motors up by 2.77% and ICICI Bank up by 2.24%.

On the flip side, Sun Pharma Industries was down by 0.06% were the top losers.

Meanwhile, Commenting on the Financial Stability report (FSR), Finance Minister Arun Jaitley has said that the Non Performing Assets (NPA) situation is under control as the economic conditions are showing signs of improvement. He pointed to some factors mentioned in the FSR including the numbers of declining weak companies and the number of stressed companies deleveraging quite fast. Jaitley further said that there are also some positive indications about their ability to pay back to the banks itself.

He highlighted that the report also states that after the Asset Quality Review exercise, the valuation of banks' share will itself increase and therefore in future it will help in capitalization. On financial performance of banks, Jaitley said that the public sector banks have collectively made an operational profit of Rs 1.40 lakh crore even in the midst of challenges. Gross NPAs of public sector banks (PSBs) went up to 7.30 per cent as of December 2015, from 5.43 per cent as of March 2015. In absolute terms, the reading increased to Rs 3,61,731 lakh crore in December, from Rs 2,67,065 lakh crore in March.

The Reserve Bank of India (RBI) recently released the Financial Stability Report in which it stated that Indian economy stands out in terms of growth among other emerging markets and the country’s financial system remains stable.

The CNX Nifty is currently trading at 8298.70, up by 94.70 points or 1.15% after trading in a range of 8242.10 and 8299.70. There were 50 stocks advancing against 1 stocks declining on the index.

The top gainers on Nifty were BHEL up by 4.72%, Zee Entertainment up by 3.65%, Grasim Industries up by 3.26%, Dr. Reddy’s Lab up by 2.95% and Tata Motors up by 2.76%.

On the flip side, Ambuja Cement down by 0.43% were the top losers.

The Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 9.08 points or 0.55% to 1,651.29, Nikkei 225 increased 9.09 points or 0.06% to 15,575.92, KOSPI Index increased 13.99 points or 0.72% to 1,970.35, Jakarta Composite increased 32.35 points or 0.65% to 5,012.45, Taiwan Weighted increased 80.02 points or 0.93% to 8,666.58 and Hang Seng increased 358.25 points or 1.75% to 20,794.37.

On the other hand, Shanghai Composite decreased 1.99 points or 0.07% to 2,929.61.

The European markets were trading mostly in green; Germany’s DAX increased 5.78 points or 0.06% to 9,618.05, France’s CAC increased 7.33 points or 0.17% to 4,202.65 while, UK’s FTSE 100 decreased 21.5 points or 0.34% to 6,338.56.