Sensex, Nifty gain over 1%; capital goods, financials lead

BHEL, L&T, ICICI Bank, Bharti Airtel and Reliance Industries have surged between 2-3.3%

Benchmark indices have extended gains and are trading higher by over 1% supported by financials and capital goods shares.

Further, US index provider MSCI Inc has told China it must further liberalise its capital markets before it will include Chinese domestic shares in one of its global benchmarks, in a setback for Beijing's efforts to promote its currency and attract foreign capital.

By 10:35, the S&P BSE Sensex was higher by 293 points at 26,774 and the CNX Nifty gained 84 points at 8,107.

The gainers on the Sensex are BHEL, L&T, ICICI Bank, Bharti Airtel and Reliance Industries, all surging between 2-3.3%.

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Updated at 9:30

Markets have started the session on a firm note tracking firm Asian cues along with strong buying among financial shares.

By 9:25, the S&P BSE Sensex was higher by 223 points at 26,703 and the CNX Nifty gained 69 points at 8,091 after hitting 8,109 mark.

Banking shares have extended yesterday’s gain after the RBI allowed banks to take control of debt-laden companies by converting loans into equity, if a debt restructuring fails to revive them within a stipulated timeframe.  

Further, global index provider MSCI has decided against including locally traded China shares in its global benchmark indices.

Inclusion of China-A shares could have triggered massive outflows from the Indian market as its weight would have got reduced in the MSCI indices.

Among broader markets, BSE Midcap and Smallcap indices are up almost 1%. The market breadth is positive with 953 advances against 261 declines on the BSE.

Further, foreign institutional investors were net sellers in Indian equities worth Rs 645.02 crore on Tuesday, as per provisional BSE data.

GLOBAL MARKETS

Asian shares made a tentative rebound from three-month lows on Wednesday though the spectre of higher borrowing costs in the United States and concerns about the apparent lack of progress in talks between Greece and its creditors sapped confidence.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.3% after hitting a fresh three-month low, though it is down almost 9% from the seven-year peak hit in late April.

Japan's Nikkei also rose 0.4%, after Tuesday's big fall to three-week lows while mainland Chinese shares suffered a small setback after US index provider MSCI Inc said on Tuesday it will hold off including China-listed shares in its widely tracked indexes.

SECTORS & STOCKS

BSE Bankex has surged over 1%. Sectors like Realty, Consumer Durables, FMCG, Healthcare, IT, Power and Oil & Gas are up 1-2%.

Financial shares have gained ground after the RBI allowed banks to take control of debt-laden companies by converting loans into equity. SBI, HDFC, Axis Bank and ICICI Bank have surged between 1-2%.

Capital Goods majors like L&T and BHEL have risen between 1-2% ahead of April IIP numbers which is scheduled to be announced on Friday.

Sun Pharma is the top Sensex gainer, up almost 2%. Other notable gainers include Bharti Airtel, Dr Reddy’s Labs, RIL, Bajaj Auto and Maruti Suzuki.

Among other shares, Sun Pharma Advanced Reseasrch Company ( SPARC) is trading higher by 5% to Rs 426 on the BSE after the company  licensed out Xelpros (Latanoprost BAK-free eye drops) to a subsidiary of Sun Pharma for the US market.

With Reuters input