Sensex up 200 points, Nifty hovers around 9,350; banking stocks lead

The benchmark indices continued to trade higher in afternoon deals thanks to gains in banking stocks after the Cabinet on Wednesday approved a new policy to deal with non-performing assets (NPAs). 

At 1:37 pm, the S&P BSE Sensex was trading at 30,109, up 215 points, while the broader Nifty50 was ruling at 9,348, up 36 points.

In the broader market, the S&P BSE Midcap and the S&P BSE Smallcap indices gained 0.3% and 0.2%, respectively.

The market breadth, indicating the overall health of the market, was positive. On the BSE, 1,415 shares rose and 1,206 shares declined. A total of 126 shares were unchanged.

Buzzing stocks 

BSE Bankex (up 1.8%) was the leading gainer among sectoral indices, led by gains in ICICI Bank (up 8%), Axis Bank (up 4%) and SBI (up 2%).

ICICI Bank jumped nearly 9% to Rs 296 in intraday trade after the the country's largest private sector lender reported three-fold jump in standalone net profit to Rs 2,024.64 crore for the quarter ended March 31. The bank had made a net profit of Rs 701.89 crore in the January-March quarter of the fiscal year 2015-16. 

Steel makers rose after the cabinet on Wednesday approved a proposal to make the use of local steel mandatory for government's infrastructure projects, aimed at boosting the sales of local companies.

Jindal Steel & Power, JSW Steel and Steel Authority of India rose more than 2% each.

Cabinet approves new NPA policy

The Union Cabinet, led by Prime Minister Narendra Modi, on Wednesday approved a new framework for dealing with Rs 6 lakh crore worth of non-performing assets (NPAs) in the banking system. 

The framework includes the promulgation of an Ordinance to amend the Banking Regulation Act to give more teeth to the Reserve Bank of India (RBI) and its oversight committees to act on behalf of banks while deciding on NPAs. The proposals are now awaiting the President’s assent.

Fed outcome

At the end of its two-day meeting, the US Federal Reserve kept its benchmark interest rate steady as expected, but downplayed weak first-quarter economic growth and emphasised the strength of the labor market, a sign it was still on track for two more rate increases this year.

Futures traders are now pricing in a 72% chance of a June rate hike, from 63% before the Fed's statement, according to the CME Group's FedWatch Tool.

Global markets

Asian stocks retreated tracking subdued trade on Wall Street. MSCI's broadest index of Asia-Pacific shares outside Japan slid 0.15% in early trade on Thursday.

Australian shares were 0.3% lower.

Japan is closed for the Golden Week holiday. South Korea's KOSPI bucked the weaker trend and was up 0.5% after touching an all-time high earlier in the session on strong corporate earnings.

Overnight, Wall Street closed flat to lower.

The Nasdaq fell 0.4% as Apple shares slid after reporting lower than expected iPhone sales on Tuesday.

(With inputs from Reuters)