After extending gains in morning trade, the two key benchmark indices trimmed gains in mid-morning trade. At 11:18 IST, the barometer index, the S&P BSE Sensex, was up 88.20 points or 0.33% at 26,612.75. The gains for the Nifty 50 index were higher than those for the Sensex in percentage terms. The Nifty was currently up 34.75 points or 0.43% at 8,162.60. Gains in global stocks aided the upmove on the domestic bourses. World stocks rose on speculation that central banks in the UK, Japan and the European Central Bank will boost monetary stimulus to counter a potential drag on the global economy from the UK's vote to leave the European Union known as Brexit.
The Sensex rose 81.76 points or 0.3% at the day's low of 26,606.31 in mid-morning trade. The barometer index jumped 176.22 points or 0.66% at the day's high of 26,700.77 in morning trade, its highest level since 23 June 2016. The Nifty rose 29.80 points or 0.36% at the day's low of 8,157.65 in mid-morning trade. The index rose 58.70 points or 0.72% at the day's high of 8,186.55 in morning trade, its highest level since 23 June 2016.
In overseas stock markets, Japanese stocks led gains in Asian markets following overnight rally on Wall Street as jitters eased after the UK's vote to leave the European Union (EU) spurred global sell-off. The Nikkei 225 Average was currently up 1.89%. Latest data showed that Japan's retail sales fell more than expected in May in a third straight month of annual declines. Retail sales fell 1.9% in May from a year earlier, data released by the Ministry of Economy, Trade and Industry showed. US stocks registered strong gains yesterday, 28 June 2016, as investors looked for bargains after the Brexit fueled sell-off.
Closer home, the broad market depicted strength. There were nearly three gainers against every loser on BSE. 1,631 shares rose and 546 shares declined. A total of 118 shares were unchanged. The BSE Mid-Cap index was currently up 0.72%. The BSE Small-Cap index was currently up 0.96%. Both these indices outperformed the Sensex.
Bank stocks edged higher on renewed buying. Among public sector banks, Canara Bank (up 1.58%), IDBI Bank (up 1.54%), Bank of India (up 0.7%), Corporation Bank (up 0.48%), Punjab National Bank (up 0.43%) and State Bank of India (up 0.39%) gained. Bank of Baroda (down 0.16%) edged lower.
Among private sector banks, Kotak Mahindra Bank (up 0.76%), IndusInd Bank (up 1.17%), ICICI Bank (up 0.62%), Yes Bank (up 0.54%) and Axis Bank (up 0.18%) edged higher.
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The Reserve Bank of India has said in its biannual publication Financial Stability Report (FSR) June 2016 that its macro stress tests suggest that under the baseline scenario, the gross non-performing advances (GNPAs) ratio of scheduled commercial banks (SCBs) may rise to 8.5% by March 2017 from 7.6% in March 2016. Under the baseline scenario, the GNPA ratio of public sector banks (PSBs) may go up to 10.1% by March 2017 from 9.6% in March 2016. Under the baseline scenario, the GNPA ratio of private sector banks (PVBs) may increase to 3.1% by March 2017 from 2.7% in March 2016, which could further increase to 4.2% under a severe stress scenario i.e. when the macroeconomic scenario deteriorates. Under a severe stress scenario, the GNPA ratio of PSBs may increase to 11% by March 2017 from 9.6% in March 2016. Under such a severe stress scenario, the CRAR (capital to risk-weighted assets ratio) of SCBs may decline to 11.5% by March 2017 from 13.2% as of March 2016.
Index heavyweight HDFC Bank was off 0.03% at Rs 1,167.45 as the stock turned ex-dividend today, 29 June 2016, for dividend of Rs 9.50 per share for the year ended 31 March 2016. Before turning ex-dividend, the stock offered a dividend yield of 0.81% based on the closing price of Rs 1,167.85 on BSE yesterday, 28 June 2016.
A strong buying interest was witnessed in realty stocks. Unitech (up 7%), Housing Development and Infrastructure (up 4.46%), Sobha (up 3.95%), D B Realty (up 2.73%), Indiabulls Real Estate (up 2.17%), Godrej Properties (up 2.2%) and Oberoi Realty (up 1.27%) edged higher. Prestige Estates Projects (down 0.11%) edged lower.
DLF surged 8.76% on media reports that promoter KP Singh and his family have decided to wipe out the company's debt in a two-step transaction. According to reports, the promoters will pump Rs 10000 crore into the company by purchasing shares in a preferential issue with funds raised from the sale of their stake in the company's rental unit. The Singh family plans to sell its 40% stake in DLF Cyber City Developers (DCCDL) for Rs 12000-13000 crore and will use the money to retire the parent company's debt, reports suggested. Separately, DLF will raise about Rs 3000 crore from institutional investors to ensure that the stake of the promoters doesn't breach the 75% threshold with the purchase of the preferential shares, as per reports.
Promoters currently hold 74.96% stake in DLF (as per the shareholding pattern as on 31 March 2016).
Index heavyweight and cigarette major ITC fell 0.91% at Rs 365. The stock hit a high of Rs 370.35 and a low of Rs 364.55 so far during the day.
Kesar Terminals & Infrastructure rose 2.16% at Rs 517.80 after the company scheduled a board meeting on 1 July 2016 to consider stock-split proposal. The announcement was made after market hours yesterday, 28 June 2016. On 24 June 2016, Kesar Terminals & Infrastructure's board had recommended issue of one bonus share for every twenty five shares held.
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