Bourses trade with gains in late afternoon session

Indian equity markets continued to trade with gains in late afternoon session led by banking stocks. Among heavy-weights Mahindra & Mahindra, Axis Bank and Tata Motors exhibited a smart performance. Traders ignored report that India’s forex reserves dropped by $4.339 billion to $589.138 billion for the week ended May 26. The reserves have been declining as the central bank deploys the kitty to defend the rupee amid pressures caused majorly by global developments. Meanwhile, India’s import of cheap Russian oil scaled another record in May and is now more than the combined oil bought from Saudi Arabia, Iraq, UAE and the US. India took 1.96 million barrels a day from Russia in May, 15 per cent more than the previous high in April.

On the global front, all Asian markets were trading higher over the crisis averting US debt ceiling deal, with Japan’s Indexes reaching 33-year peaks. At the same time, smaller wage gains stoked hopes inflationary pressures are weakening. European markets were trading mostly in green as markets struggled to hold on to the tailwind from a rebound seen last week, while London stocks led regional gains following upbeat performances by energy firms on the back of higher oil prices.

The BSE Sensex is currently trading at 62866.77, up by 319.66 points or 0.51% after trading in a range of 62751.72 and 62943.20. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.41%, while Small cap index was up by 0.64%.

The top gaining sectoral indices on the BSE were Auto up by 1.36%, Industrials up by 1.08%, Capital Goods up by 1.04%, Utilities up by 0.91% and Bankex was up by 0.70%, while FMCG down by 0.31% and Realty was down by 0.03% were the only losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 4.27%, Axis Bank up by 2.92%, Tata Motors up by 2.31%, Sun Pharma up by 1.35% and Larsen & Toubro up by 1.26%. On the flip side, Tech Mahindra down by 1.03%, Nestle down by 1.01%, Asian Paints down by 0.98%, Hindustan Unilever down by 0.97% and TCS down by 0.29% were the top losers.

Meanwhile, RBI Deputy Governor M Rajeshwar Rao has said that India's banking sector needs to address gaps in the governance frameworks and assurance functions in a bid to gear up to meet the future challenges as the country strives to become a developed nation by 2047. He emphasized that financial institutions will need extraordinary amounts of financial resources to support growth to realize the visions for a brighter tomorrow.  

Rao has stated that raising these resources would not be a constraint for financial intermediaries with robust governance frameworks as they can command a governance premium. It is important in this context to gain and retain the trust of other stakeholders such as depositors and various providers of financial resources. This is best ensured by strong governance, control, and assurance functions in financial institutions. Also, he said while we collectively aspire for an efficient financial intermediation with positive spillover to the real sectors, these aspirations are set in an increasingly competitive, diverse, and interconnected world. 

RBI Deputy Governor said the banking sector in India at this juncture is sound, resilient, and financially healthy. So, the time is perhaps right to improve the plumbing by addressing the gaps in governance frameworks, assurance functions and strategise for better times ahead. Observing that it is essential for the management to deliver good performance, he said but more importantly this should be achieved by adhering to acceptable customer and market conduct and best corporate governance practices.

The CNX Nifty is currently trading at 18619.30, up by 85.20 points or 0.46% after trading in a range of 18582.80 and 18640.15. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Mahindra & Mahindra up by 4.18%, Axis Bank up by 2.89%, Tata Motors up by 2.30%, Grasim Industries up by 1.37% and Larsen & Toubro up by 1.36%. On the flip side, Divi's Lab down by 1.19%, Tech Mahindra down by 1.06%, Asian Paints down by 0.98%, Nestle down by 0.96% and Hindustan Unilever down by 0.96% were the top losers.

All Asian markets were trading higher, Nikkei 225 surged 693.21 points or 2.15% to 32,217.43, Hang Seng advanced 158.56 points or 0.83% to 19,108.50, Straits Times rose 19.72 points or 0.62% to 3,186.02, Jakarta Composite gained 18.85 points or 0.28% to 6,652.11, KOSPI increased 14.05 points or 0.54% to 2,615.41, Taiwan Weighted added 7.52 points or 0.04% to 16,714.43 and Shanghai Composite was up by 2.37 points or 0.07% to 3,232.44.

European markets were trading mostly in green, UK’s FTSE 100 increased 44.14 points or 0.58% to 7,651.42 and Germany’s DAX was up by 7.53 points or 0.05% to 16,058.76. On the flip side, France’s CAC was down by 0.23 points or 0% to 7,270.46.