Benchmarks turn rangebound; PSU banks slide

The key equity indices traded in a narrow range with small losses in early afternoon trade. The Nifty hovered below the 22,400 mark after hitting the day's high of 22,619 in early trade. PSU bank shares witnessed profit booking after advancing in the past four trading sessions. Trading was volatile due to the expiry of weekly index options on the NSE.

At 12:27 IST, the S&P BSE Sensex, was down 26.41 points or 0.04% to 73,849.40. The Nifty 50 index lost 38.05 points or 0.17% to 22,396.60.

The Sensex and Nifty clocked an all-time high of 74,501.73 and 22,619, respectively in early trade.

In the broader market, the S&P BSE Mid-Cap index shed 0.29% and the S&P BSE Small-Cap index rose 0.15%.

The market breadth was positive. On the BSE, 2,120 shares rose and 1,598 shares fell. A total of 127 shares were unchanged.

The RBI Monetary Policy Committee (MPC) kicked off its 3-day meeting deliberating interest rates and analysing the state of the economy on April 3 and will end on April 5. While the RBI is widely expected to keep rates on hold, any signals on inflation and economic growth will be closely watched, as per reports.

Economy:

The HSBC India Services Purchasing Managers' Index , compiled by S&P Global, rose to 61.2 last month from February's 60.6, pointed to one of the strongest growth rates seen in over 13-and-a-half years. The upturn was largely attributed to healthy demand conditions, efficiency gains and positive sales developments.

Ines Lam, Economist at HSBC, said, Indias services PMI rose in March, following a small dip in February, on the back of strong demand that spurred sales and business activity. Service providers increased hiring at the fastest pace since August 2023 in order to expand production capacity. Input costs rose at a faster rate, yet service providers were able to broadly maintain margins by charging higher output prices.

The HSBC India Composite PMI Output Index increased to 61.8 in March from 60.6 in February, highlighting the second-strongest upturn in over 13-and-ahalf years (behind July 2023).

Derivatives:

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, rose 0.85% to 11.47. The Nifty 25 April 2024 futures were trading at 22,498.70, at a premium of 102.1 points as compared with the spot at 22,396.60

The Nifty option chain for the 25 April 2024 expiry showed maximum Call OI of 35.5 lakh contracts at the 22,500 strike price. Maximum Put OI of 36.4 lakh contracts were seen at 22,500 strike price.

Buzzing Index:

The Nifty PSU bank index slipped 1.03% to 7,228.90. The index has surged 6.96% in the past four trading sessions.

Bank of Maharashtra (down 2.02%), Punjab & Sind Bank (down 1.95%), UCO Bank (down 1.93%), Indian Overseas Bank (down 1.87%), Bank of Baroda (down 1.73%), Central Bank of India (down 1.45%), State Bank of India (down 1.37%), Punjab National Bank (down 0.44%), Canara Bank (down 0.42%) and Indian Bank (down 0.42%) declined.

On the other hand, Bank of India (up 1.62%) and Union Bank of India (up 0.06%) edged higher.

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