Midcap state-owned banks gain on short-covering in Nov futures

Reuters Market Eye - Shares of midcap state-owned banks gain as investors unwind short positions in November futures on hopes of easing inflation after a steep fall in crude oil prices, dealers say.

Brent crude dropped more than $2 a barrel on Monday as supply fears eased following a breakthrough nuclear deal between world powers and Iran over the weekend.

Dealers also add some lightening of positions is seen on risk reduction ahead of the expiry of November derivative contracts on Thursday.

UCO Bank gains 1.7 percent after outstanding open positions in the November contract fell by 1.7 million shares. Indian Overseas Bank is up 1.6 percent after unwinding of 320,000 shares, while IDBI Bank Ltd rises 1.8 percent after a cut of 250,000 shares in outstanding November futures positions, as per Thomson Reuters data.

(Reporting by Abhishek Vishnoi)