Sensex, Nifty at day’s high; Healthcare stocks shine

Key Indian equity benchmarks continued northward rally in afternoon session to reach at their intraday high points, with the Sensex and Nifty gaining more than 200 and 50 pints, respectively, despite mixed cues from other Asian markets. In line with the larger peers, the broader markets too performed well in noon deals, while Healthcare index gained the most among all the sectoral indices. Besides, the major industry gainers like Dr. Reddy’s Lab, SBI and Sun Pharma, helped the key indices to extend gains. Traders continued to take encouragement with a report that the Reserve Bank of India has came out with draft guidelines on loan system for delivery of bank credit, in order to improve discipline among larger borrowers with working capital facility from the banking system. Further, some support also came with finance ministry official’s statement that the government is likely to launch a Rs 500-crore credit enhancement fund next month to facilitate infrastructure investments by insurance and pension funds. On the sectoral front, banking stocks were trading higher, supported by finance ministry official’s statement that more banks are unlikely to be brought under the RBI's Prompt Corrective Action (PCA) framework as the situation pertaining to bad loans is expected to improve in the next couple of quarters. Adding some optimism, the Union government has formed a new committee under the chairmanship of former Chief Statistician Prof. T.C.A Anant to bring more transparency in employment related data releases.

On the global front, Asian markets were trading mixed, amid cautious trades as the historic meeting between U.S. President Donald Trump and North Korean leader Kim Jong Un began in Singapore. Investors were also looking ahead to key central bank meetings this week. While the US Federal Reserve's two-day policy meeting begins later today, the European Central Bank and the Bank of Japan will hold their meetings on Thursday and Friday respectively. Back home, in scrip specific development, Orchid Pharma touched the roof after the company received European Union (EU) Good Manufacturing Practice (GMP) certification based on the inspection of the Orchid’s API manufacturing facility located at SIDCO Industrial Estate, Kancheepuram district, in the state of Tamil Nadu.

The BSE Sensex is currently trading at 35715.50, up by 232.03 points or 0.65% after trading in a range of 35479.07 and 35717.05. There were 25 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.67%, while Small cap index was up by 0.52%.

The top gaining sectoral indices on the BSE were Healthcare up by 2.02%, FMCG up by 0.77%, Capital Goods up by 0.69%, Energy up by 0.67% and IT up by 0.64%, while Utilities down by 0.39%, Metal down by 0.15%, Power down by 0.12% and Basic Materials down by 0.05% were the top losing indices on BSE.

The top gainers on the Sensex were Dr. Reddy’s Lab up by 4.97%, SBI up by 1.85%, Sun Pharma up by 1.49%, TCS up by 1.39% and Indusind Bank up by 1.34%. On the flip side, Coal India down by 0.97%, Power Grid Corporation down by 0.94%, Tata Steel down by 0.76%, Bharti Airtel down by 0.58% and NTPC down by 0.19% were the top losers.

Meanwhile, with expectations of improvement in bad loans situation in the next couple of quarters, Finance Ministry Official has said that more banks are unlikely to be brought under the Reserve Bank of India’s (RBI) Prompt Corrective Action (PCA) framework.

Official further noted that NPAs at banks grew during the fourth quarter of 2017-18 but in the coming months, they are expected to decline sizably, on the back of gaining strength of the debt resolution process under bankruptcy law. Ministry Official also added that the ministry does not expect more banks to come under the PCA, since there is clear pipeline for NPA resolution.

Besides, Finance Ministry Official is also expecting improvement in financial health of PSBs which are on the verge of coming under the PCA, within a quarter or two and added that the recent tight prudential norms released by the RBI on February 12 have added to the woes of the lenders.

The CNX Nifty is currently trading at 10853.40, up by 66.45 points or 0.62% after trading in a range of 10789.40 and 10854.20. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Dr. Reddy’s Lab up by 4.89%, Lupin up by 4.39%, SBI up by 1.77%, ITC up by 1.47% and Cipla up by 1.42%. On the flip side, Coal India down by 1.11%, Power Grid Corporation down by 0.95%, Grasim Industries down by 0.84%, UPL down by 0.79% and Tata Steel down by 0.74% were the top losers.

Asian markets were trading mixed; Shanghai Composite increased 26.96 points or 0.88% to 3,079.74, Nikkei 225 increased 74.31 points or 0.33% to 22,878.35 and Hang Seng increased 120.55 points or 0.39% to 31,184.25. On the flip side, FTSE Bursa Malaysia KLCI decreased 6.87 points or 0.39% to 1,768.93, Taiwan Weighted decreased 4.44 points or 0.04% to 11,144.79 and KOSPI Index decreased 1.32 points or 0.05% to 2,468.83.