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Markets were trading over 1% higher in noon trades on Monday led by financials with state-owned bank shares gaining the most along with capital goods shares.
At 1PM, the 30-share Sensex was up 280 points at 25,380 and the 50-share Nifty was up 89 points at 7,598.
The Indian rupee was trading nearly unchanged at Rs 60.09 compared to its previous close of Rs 60.08.
Dollar demand from oil marketing companies looking to meet month-end demand is expected to limit any sharp downward pressure on the USD/INR pair.
Asian markets came of their day's highs and were trading mixed with the Nikkei gaining 0.4% to end at 15,162 while Straits Times was trading 0.7% higher. China's benchmark share index, Shanghai Composite was up 0.5% while Hang Seng was down 0.8%.
BSE Bankex and Capital GOods indices were the top sectoral gainers while CNX PSU Bank index on the NSE was the top sectoral gainer up over 3%.
Shares of state-owned banks are witnessing buying action and have rallied by up to 7% on the National Stock Exchange (NSE). According to Mint reports, the government is likely to take a decision on a proposal to create a holding company structure for public sector banks before the Budget and a road map for this is likely to be announced in the budget.
Allahabad Bank, Oriental Bank of Commerce, Canara Bank, Bank of India, Syndicate Bank and Union Bank of India have surged more than 5% each. Andhra Bank, Indian Overseas Bank, Bank of Baroda, Punjab National Bank, IDBI Bank and State Bank of India are up 2-4% on NSE.
In the private banking space ICICI Bank was up 3% contributing the most to the Sensex gains along with HDFC Bank and Axis Bank.
Capital goods shares witnessed buying after the recent extension of excise duty concession for a further period of six months till December 31, 2014. Larsen & Toubro was up 2.5% and BHEL gained 2.3%.
Other Sensex gainers include, ITC, ONGC, Infosys and Sun Pharma.
Among other shares, Housing Development & Infrastructure Ltd (HDIL) has moved higher by 4% to Rs 100 Citigroup bought 4 million shares of the Mumbai-based real estate developer for about Rs 38 crore through open market. On June 27, 2014 Citigroup Global Markets Mauritius Pvt Ltd bought 4 million shares representing 0.96% stake in the company at Rs 94.05 a share, the NSE bulk deal data shows.
The broader markets also witnessed buying activity with BSE Mid-cap and Small-cap indices up 1.5% each.
Market breadth was strong with 1,923 gainers and 845 losers on the BSE.
