Sensex climbs to two-month high, Nifty ends higher; YES Bank rises 8.4%

The Indian stock markets rose on Thursday amid expiry of derivatives contracts, supported by positive global cues and gains in stocks of private banks, information technology and fast-moving consumer good (FMCGs). 

The benchmark BSE Sensex gained 212 points or 0.6 per cent, to close at 34,713.6, highest since February 22. The index is up 5.3 per cent this month, having gained in 15 of 19 trading sessions. From the 2018 low of 32,596, the Sensex has rebounded 6.5 per cent but is still 4.3 per cent below the peak of 36,283 in January. The National Stock Exchange’s Nifty 50 Index rose 0.5 per cent to 10,617.8.

YES Bank surged 8.4 per cent, the highest since February 1, after its bad loans reduced as a proportion of the total book. Many analysts see quarterly earnings reports and the coming state elections as providing direction for India’s key equity gauges, little changed this year.

The latest rebound in the market comes after a sharp 10 per cent drop between February and March, amid rising yields in the US, global trade tensions and domestic concerns like banking fraud and political uncertainty. The latest rally is despite headwinds such as rising crude oil prices and weakening of the rupee.

Rollover trend points to further upside

The rollover trend on Thursday, expiry day for April series derivatives contracts, signals that the positive momentum will sustain, said analysts. Market-wide rollover for the April series was 85.5 per cent, compared to the previous three-month average of 84.4 per cent. Rollovers for the Nifty and Bank Nifty indices were 70.4 per cent and 81.5 per cent, respectively. Previous three-month averages were 62.6 per cent and 67.6 per cent, respectively. The high rollovers, amid a five per cent rally in the past month, indicate more steam left in the market, said experts.

“The majority od the rolls were on the long side. Foreign investors, too, have rolled over long positions. The long-short ratio has improved from 18 per cent to 53 per cent. Implied volatility has reduced. The options open interest shows the market range has shifted higher. Overall, the data suggests the momentum will continue,” said Sneha Seth, derivative analyst at Angel Broking.