Markets recover from day's low; Sensex gains 100 points

PSBs are trading weak after reporting a disappointing set of numbers for the quarter ended March 31, 2016

Markets have reversed its losses and are trading flat with a positive bias as gains in technology shares coupled with strength in the index heavyweights have capped the downside.

Next batch of Q4 FY16 earnings, progress of monsoon along with election poll outcome have kept the investors edgy.

At 14:38 pm, the S&P BSE Sensex was up 100 points at 25,590 and the Nifty50 was up 28 points at 7,843.

Adds Nikhil Kamath, Co-Founder & Director, Zerodha, "Markets looked choppy in trade through the first half of the day, the weakness led by the banking sector with SBI correcting over 4 %. This was followed by a rally which started at 1 pm taking the Nifty back into the positive territory, this was led by IT and the FMCG sector. This recovery could indicate the underlying strength in the market as it came on the back of negative international cues and no macroeconomic news as such. Put writing at the 7700 levels also indicates a floor for the market, with the smart money calling a bottom for the markets at the 7700 levels for the May series. Overall the picture still looks range bound with the indices largely fluctuating between the 7700-8000 levels, Fii activity also remains muted. We would recommend increasing exposure to cash and fixed income at this point."
 

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(updated at 12:57pm)
 

Benchmark indices continue to trade lower amid choppy trades tracking weakness in banking shares mainly PSBs after reporting a disappointing set of numbers for the quarter ended March 31, 2016.

Further, India's annual wholesale price inflation (WPI) moved up into the positive zone at 0.34% for April, from (-)0.85% in March and (-)2.43% during the corresponding month of the previous year, official data showed on Monday.

At 12:57 pm, the S&P BSE Sensex was down 115 points at 25,375 and the Nifty50 was down 36 points at 7,779. In the broader market, the BSE Midcap and Smallcap indices are down 0.2%-0.4%.  

In the currency front, the rupee weakened by 13 paise to 66.90 against the US dollar due to continued demand for the American currency from banks and importers.  

Meanwhile, oil rose to fresh 2016 highs in Asia today as a slowdown in US drilling and increase in Chinese crude refinery processing bolstered hopes a supply glut would ease sooner than expected.

In overseas markets, most Asian stocks rose, shrugging off soft Chinese data released over the weekend. China's investment, factory output and retail sales all grew more slowly than expected in April, adding to doubts about whether the world's second-largest economy is stabilizing, data released on Saturday showed.

Back home, Public sector banks (PSBs) were trading lower by up to 7% on the bourses after reporting a disappointing set of numbers for the quarter ended March 31, 2016 (Q4F16).

Bank of Baroda (BOB), Union Bank of India, Central Bank of India, Dena Bank, Allahabad Bank, Bank of India (BOI), Uco Bank, Syndicate Bank, Indian Overseas Bank and State Bank of India (SBI) declined over 2% each on the National Stock Exchange (NSE).

PSU Engineering major Bharat Heavy Electricals said that it has commissioned a 660 Mw supercritical thermal unit for the Mouda Super Thermal Power Station (STPS) in Nagpur district of Maharashtra. Shares of BHEL are down 2%.

Asian Paints, Berger Paints India, Bajaj Finance, Finolex Industries, IndusInd Bank, KPR Mills, Supreme Industries and Cholamandalam Investment and Finance Company from the BSE-500 index have touch their respective lifetime highs on the Bombay Stock Exchange (BSE) in intra-day trade on Monday.