Markets continue to trade firm

ICICI Bank up ahead of results

Markets continued to hold on to gains and moved sideways in late-morning trades. The Sensex is up 76 points at 17,206. Nifty is up 25 points at 5,213.

Asian shares have inched up this morning, tracking US stocks which jumped overnight on strong housing data and earnings, but concerns over the health of European banks weighed on investor risk appetite after Standard & Poor's downgraded Spain's rating. Nikkei has gained 1 per cent to 9,671.

BSE bankex has gained 1% to 11,788. Reports suggest that the Cabinet has approved a proposal to cap shareholders’ voting rights in private banks at 26 per cent irrespective of their total holding.

Consumer durables, power and capital goods indices also advanced in trades.

ICICI Bank has added 2.6% at Rs 864 ahead of its Q4 numbers. A Morgan Stanley report suggests that revenue growth may be muted, driven by flat/slightly lower margins QoQ and sluggish volume growth. In the case of State-owned (SOE) banks, they expect asset quality issues to continue with new impaired loan creation remaining elevated. For private banks, they expect some pickup in new impaired loan creation but expect overall asset quality trends to be better relative to SOE banks.

Mahindra & Mahindra, Hindalco, TCS and Sterlite have added 1-2% each. Among other gainers are Bajaj AUto, DLF, HDFC Bank and Larsen & Toubro.

Meanwhile, Coal India has slipped 1.6% to Rs 354. Bharti Airtel has dropped 1%, followed by Reliance, Sun Pharma and SBI. Reliance Industries has reported natural gas production from its eastern offshore KG-D6 fields dropping to less than 34 million standard cubic meters a day.

Among individual stocks, tyre maker MRF has reported a 67.1 per cent increase in standalone net profit for the March quarter at Rs 150.1 crore. The stock is up 1.2% at 11,375.

Asian Paints and Bank of Baroda (BOB), both are trading higher on inclusion in Nifty, in place of Reliance Power and Reliance Communication Nifty with effect from today.

BSE market breadth is positive. Out of 2,454 shares traded, 1,405 shares have advanced while 934 shares have declined in trades.