Banks stocks saw heavy buying interest after Bank of India recovered Rs 7,000 crore worth of Standby Letter of Credits from other banks.PSU Bank index was up 3.5 percent and Nifty Bank index gained 1 percent, outperforming the Nifty that rose 0.3 percent.
Bank of India, OBC, Union Bank, Bank of Baroda, Andhra Bank, Syndicate Bank, PNB, Canara Bank, Allahabad Bank, Indian Bank, IDBI Bank and SBI rallied up to 9 percent.
Axis Bank, ICICI Bank, and Federal Bank gained around 1.5 percent.
Rupee Trade: The rupee inched higher by 9 paise to 64.95 against the US dollar on better-than-expected inflation numbers and mild selling of the greenback by exporters amid sustained foreign capital inflows.
However, the dollar gains against most major global currencies overseas limited the gains for the domestic unit.
A 7.5 percent growth in industrial output in January and selling of the American currency by exporters supported the rupee, forex dealers said.
Yesterday, the rupee ended higher by 13 paise to close at 65.04 against the US currency on the back of foreign fund inflows after sharp gains in equity markets and weakness in the dollar against global currencies.
9:45 am Buzzing Stocks: Shares of Bank of India rose 10 percent on the back of recovery of Rs 7,000 crore from other banks.
The bank has recovered Rs 7,000 crore worth Standby Letters of Credit (SLOCs) in the last two months and the balance of Rs 2,000 crore would be recovered in another two months, a top bank official said.
This recovery will substantially improve the bank’s balance sheet, Bank of India Executive Director N Damodharan told reporters.
TCS shares fell more than 5 percent in morning after the large block deal trade.
Tata Sons, the promoter of major operating companies of the Tata group, was planning to raise around Rs 8,200 crore by selling a stake in the IT major, according to investment banking sources.
Tata Sons were looking to sell around 2.83 crore shares amounting to about 1.48 percent stake in TCS, the sources added.
After the proposed share sale, Tata Sons’ holding in Tata Consultancy Services (TCS) would come down to around 72 percent from 73.52 percent as on December 2017.
The sources said Tata Sons intends to use the proceeds from the share sale to reduce debt in the group’s telecom arm Tata Teleservices which has a debt of around Rs 40,000 crore.
Last year in October, Tata Group had agreed to sell its loss-making mobile telephony business to Bharti Airtel on “a debt-free cash-free basis”.
The 30-share BSE Sensex was down 25.52 points at 33,892.42 and the 50-share NSE Nifty fell 7.50 points to 10,413.90.
TCS was the biggest loser among Nifty50 stocks, falling more than 5 percent after big block deal.
Nifty Midcap was down 38 points and Nifty Bank was flat.
UCO Bank, IDBI Bank, PNB, Canara Bank, Bank of Baroda, Balrampur Chini, Shree Renuka, Dhampur Sugar, InterGlobe Aviation and Biocon fell up to 5 percent.
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