Markets remain firm on sustained buying support

Mirroring their Asian peers, Indian equity markets were trading in fine fettle with Sensex and Nifty crossing 37,400 and 11,300 levels in the early noon session due to heavy buying in Metal, Oil & Gas and PSU stocks. Gains in frontline blue chip stocks such as Tata Steel and ONGC also helped lift the markets. Lower crude oil prices and the sharp recovery in Indian rupee, also supported the indices. Some support came with a report stating that Indian farmers and U.S. manufacturers of medical devices could be among the main winners in a trade package under negotiation, as the US and India look to remove long-standing irritants to ties. Beside, Finance Minister Arun Jaitley made a case for blending subsidy with investment to augment farm sector growth and make it sustainable and self-sufficient.

On the global front, Asian markets were trading mostly in green. Japanese stocks jumped amid added gains for dollar-yen and bond yields and Chinese stocks shrugged off new tariffs. Back home, the market breadth on BSE was favoring positive trend; there were 1187 shares on the gaining side against 1135 shares on the losing side while 136 shares remained unchanged. In scrip specific development, Som Distilleries gained with arm launching Blackfort Beer.

The BSE Sensex is currently trading at 37423.26, up by 132.59 points or 0.36% after trading in a range of 37295.57 and 37530.63. There were 25 stocks advancing against 6 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index gained 0.28%, while Small cap index was down by 0.10%.

The top gaining sectoral indices on the BSE were Metal up by 2.16%, Oil & Gas up by 1.18%, PSU up by 1.11%, Basic Materials up by 1.07% and Telecom was up by 0.84%, while Consumer Durables down by 0.81% was the sole losing index on BSE.

The top gainers on the Sensex were Tata Steel up by 2.82%, ONGC up by 2.28%, Coal India up by 1.85%, Hero MotoCorp up by 1.70% and Bajaj Auto up by 1.57%. On the flip side, Maruti Suzuki down by 0.94%, HDFC Bank down by 0.74%, HDFC down by 0.65%, Indusind Bank down by 0.62% and Wipro down by 0.53% were the top losers.

Meanwhile, a day after the government proposed to merge three public sector banks, global credit rating agency, Moody’s Investors Service has said that merger of Bank of Baroda, Vijaya Bank and Dena Bank will be credit positive as it will provide efficiencies of scale and help improve the quality of corporate governance for the banks.

The rating agency also noted that the merged entity will become third largest bank in the system, with a loan market share of about 6.8 per cent. It further expressed need of capital support from the government to the merged entity, adding that if it is not provided then such a merger would not improve their capitalisation profile.

Besides, Moody’s highlighted that Bank of Baroda and Vijaya Bank have relatively better credit metrics than Dena Bank in terms of asset quality, capitalisation and profitability. Meanwhile, the government proposed the merger of the three state-owned banks to create the country’s third largest lender, as part of efforts to revive credit and economic growth.

The CNX Nifty is currently trading at 11322.10, up by 43.20 points or 0.38% after trading in a range of 11280.25 and 11332.05. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 2.82%, BPCL up by 2.59%, GAIL India up by 2.19%, ONGC up by 2.04% and Hindalco up by 2.03%. On the flip side, Zee Entertainment down by 2.30%, Lupin down by 1.29%, Titan Co down by 1.09%, Maruti Suzuki down by 0.97% and Bajaj Finserv down by 0.81% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 356.59 points or 1.3% to 27,441.25, Shanghai Composite increased 42.22 points or 1.54% to 2,742.17, Nikkei 225 increased 251.98 points or 1.06% to 23,672.52, Taiwan Weighted increased 97.06 points or 0.89% to 10,857.27, Straits Times increased 32.42 points or 1.02% to 3,171.76 and Jakarta Composite increased 57.72 points or 0.98% to 5,869.51.

On the flip side, KOSPI decreased 1.04 points or 0.05% to 2,307.94.