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FII inflow continues, Sensex ends above 44,000




The Indian stock market continued its record run on Monday amid volatility, as the BSE Sensex ended above the 44,000 mark after touching a fresh intra-day high earlier during the day.

Minutes into the trade on Monday, Sensex hit an all-time high of 44,271.15 points.

The surge in the domestic stock market was led by healthy buying in IT, oil and gas and metal stocks, while banking and finance stocks fell.

Continued inflow of foreign institutional investments (FII) also supported the indices. Net FII inflow during the day stood at Rs 4,738.44 crore. However, DIIs continued to pull out from equities with net outflow of Rs 2,944.05 crore on Monday.

Binod Kumar Modi, Head – Strategy with Reliance Securities said a robust Q2 earnings and improved prospects of strong earnings momentum in subsequent quarters along with continued reforms undertaken by the government to stimulate economic activities attracted foreign funds.

“In our view, domestic equities continued to offer better risk reward propositions to FPIs in the backdrop of corporate earnings recovery, stable government and a number of measures taken by government to revive investment activities in the country. Additionally, weaker dollar index and absence of quality value play at reasonable valuations at their respective markets made FPIs to move emerging markets like India,” he said.

The BSE Sensex closed at 44,077.15, higher by 194.90 points or 0.44 per cent from the previous close of 43,882.25.

It had opened at 44,164.17 and touched an intra-day low of 43,747.22 points.

The Nifty50 on the National Stock Exchange closed at 12,926.45, higher by 67.40 points or 0.52 per cent from its previous close.

Siddhartha Khemka, Head of Retail Research, Motilal Oswal Financial Services Ltd said that global cues were positive post the news that AstraZeneca’s COVID-19 vaccine could be highly effective without any serious side effects, which follows a string of encouraging vaccine results in recent weeks.

“Investors pinned hopes for economic revival on coronavirus vaccines, despite surging cases globally and delays to fresh US stimulus. On the domestic side, markets gained as AstraZeneca vaccine can be stored and transported in the fridge and does not require freezers, like other vaccines, making it an easier option for developing nations including India,” he said.

Khemka further said noted that Reliance Industries rallied around three per cent after the Competition Commission of India (CCI) cleared the proposal to buy Future Group’s retail assets.

Banks, NBFCs and MFIs gained after an RBI committee recommended wide-ranging changes to India’s banking industry, including setting a higher cap for the size of promoters’ stakes. However, Nifty Bank and Nifty Financial Sector indices pared gains later.

He said that going ahead, the market is likely to be volatile as sentiments oscillate between fear of rising covid cases globally and optimism over vaccine progress. Investors would also closely watch out the development over the US stimulus talks where the hopes are fading.

“However the overall structure of the market remains positive, as the economic activity continues to improve and covid cases continue to decline domestically, except for few regions,” he added.


PSBs to get Rs 9k cr from assets of economic offenders, FM assures cases being actively pursued




State-run banks will get a total of Rs 9,041.5 crore through the sale of assets belonging to economic offenders such as Vijay Mallya, Nirav Modi and Mehul Choksi, attached or seized by the Enforcement Directorate under the provisions of PMLA.

Taking to Twitter, Union Finance Minister Nirmala Sitharaman on Wednesday said that fugitives and economic offenders will be actively pursued and dues would be recovered by attaching their properties.

“Fugitives & economic offenders will be actively pursued; their properties attached & dues recovered. #PSBs have already recovered Rs 1357 Cr by selling such shares. A total of Rs 9041.5 Cr shall be realised by banks through sale of such attached assets,” she said.

The Enforcement Directorate (ED) earlier on Wednesday handed over assets worth Rs 9,371 crore belonging to fugitive businessmen Vijay Mallya, Nirav Modi, Mehul Choksi to state-run banks to realise the losses on account of the fraud committed against them.

The ED has booked the three on the basis of the FIR filed by the Central Bureau of Investigation (CBI).

The ED statement said that it has attached or seized assets worth Rs 18,170.02 crore which included assets worth Rs 969 crore in foreign countries.

“The quantum of the attached and seized assets represents 80.45 per cent of total bank loss of Rs 22,585.83 crore,” it said, adding that the investigation by the ED has proved that a substantial part of these assets were held in the names of dummy entities, trusts, third persons, relatives of these accused.

“Today, DRT on behalf of SBI led consortium, has sold shares of United Breweries Limited for Rs 5,824.50 crore,” it said, adding that further realisation of Rs 800 crore by sale of shares is expected by June 25.

It also said that due to the cooperation and help extended by the ED, Public Sector Banks have already recovered Rs 1,357 crore by selling the shares earlier.

“Thus, the banks shall be realising total amount of Rs 9,041.5 crore through sale of a part of assets attached/seized by ED under the provisions of PMLA,” the ED said.

“As on date, out of total attached or seized assets of Rs 18,170.02 crore under provisions of PMLA, assets worth Rs 329.67 crore have been confiscated and assets worth Rs 9,041.5 crore, representing 40 per cent of total loss to the bank have been handed over to the Public Sector Banks,” it added.

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SBI may need to raise only up to Rs 9K cr in capital in FY22




Country’s largest bank State Bank of India may raise only up to Rs 9,000 crore in capital through additional tier I bonds (AT1 bonds) in current financial year (FY22) and could consider additional raising plan only next year to further enhance it’s capital adequacy profile.

Official sources said that the bank is sitting with a sound capital adequacy ratio (CAR) of 13.74 per cent and expects loan growth to touch close to 9 per cent in FY22. This would prevent the bank from raising full quanta of Rs 14,000 crore Tier-I capital raising plan that its board approved early this year.

The SBI Central Board on Monday approved plan to raise up to Rs 14,000 crore in capital through additional tier I bonds (AT1 bonds) by way of issuance of Basel lll compliant debt instrument in rupee and/or US dollar in FY 22.

Sources said that most of the capital raised by the SBI would be used to finance the maturity of AT1 and Tier-II bond coming up this year. The maturity amount works to about Rs 9,000 crore that could be financed through the capital raised by the bank this year.

An SBI executive said that permission for Rs 14,000 crore capital raising plan is an enabling provision and the actual issuance will depend on the market conditions and credit growth in the system.

Sources said that the centre has approved the capital raise plan of the bank, but it could not be verified with the officials. Concurrence of the centre is important as it is promoter of the bank with 57.63 per cent stake as of March 31, 2021.

SBI’s Common Equity Tier I (CETI) was 10.02 per cent in March 2021 higher than regulatory requirement of 7.97 per cent. Its AT-1 level was 1.42 per cent in March 2021, up from 1.23 per cent in March 2020.

With CETI higher than regulatory requirements, SBI is not hard pressed to raise capital and would approach the board and shareholders for requisite approvals as and when need arises.

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Equity indices shed gains post gap-up opening




The key Indian equity indices pared their initial gains after a gap-up opening to trade on a flat-to-negative note on Wednesday morning.

Selling pressure was witnessed in oil and gas, power and banking stocks.

Around 10.15 a.m., Sensex was trading at 52,555.34, lower by 33.37 points or 0.06 per cent from its previous close of 52,588.71.

It opened at 52,912.35 and has so far touched an intra-day high of 52,912.35 and a low of 52,534.70 points.

The Nifty50 on the National Stock Exchange was trading at 15,761.25, lower by 11.50 points or 0.07 per cent from its previous close.

Manish Hathiramani, technical analyst with Deen Dayal Investments said: “The Nifty resisted around the 15,900 levels yesterday so we still have to get past that for the markets to start moving up. If we can get past this level with ease, we should be targeting 16,100.”

“A good support lies at 15,400 and as long as that does not break on a closing basis, dips can be utilised to enter long positions. If we fail to cross 15,900, the markets might become range bound in 15,400-15,900.”

The top gainers on the Sensex so far were Maruti Suzuki India, Bajaj Finance and Sun Pharmaceutical Industries, while Tech Mahindra, Kotak Mahindra and UltraTech Cement were the major losers so far.

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