Sensex, Nifty trade rangebound; Nifty PSU Bank top loser
The domestic market opened higher on Wednesday even as Asian markets were trading mixed as investor nerves were strained ahead of a US inflation report that could soothe, or inflame, fears of faster rate hikes globally.
At 9:20 am, the S&P BSE Sensex was trading at 34,388, up 88.43 points, while the broader Nifty50 was ruling at 10,569, up 29.80 points.
In the broader market, the BSE Midcap and the BSE Smallcap indices outperformed to gain 0.7 per cent and 0.9 per cent, respectively.
Vedanta (up 2 per cent), Tech Mahindra (up 1.5 per cent) and Adani Ports (up 1 per cent) were the leading gainers on the Nifty50, while Bharti Infratel (down 1.5 per cent), Axis Bank (down 1.5 per cent) and Sun Pharma (down 1.2 per cent) shed the most.
Banking stocks under pressure
Banking stocks were under pressure after Reserve Bank of India (RBI) on Monday revised guidelines to fight with the bad loans in the public sector banks. Nifty PSU Bank index was the leading loser among NSE indices.
The revised framework has specified norms for "early identification" of stressed assets, timelines for implementation of resolution plans, and a penalty on banks for failing to adhere to the prescribed timelines.
The latest notification issued by RBI last night has also withdrawn the existing mechanism which included Corporate Debt Restructuring Scheme, Strategic Debt Restructuring Scheme (SDR) and Scheme for Sustainable Structuring of Stressed Assets (S4A).
Overseas, Asian markets were under pressure. The early inclination was to hope for the best and E-Minis for the S&P 500 added 0.1 per cent while MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.3 per cent.
Yet Japan’s Nikkei could not hold early gains and slipped 0.7 per cent to test four-month lows. Dealers said there was a lot of focus on the 200-day moving average at 21,031 as a break there would ring bearish alarm bells.
On Wall Street, the Dow had ended up a slim 0.16 per cent, while the S&P 500 gained 0.26 per cent and the Nasdaq 0.45 per cent.
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