Here’s what drone BSE midcap index to hit all-time high

By: | Updated: July 12, 2016 8:38 AM

The BSE mid-cap index hit an all time high on Monday with a strong show by non-bank financial companies (NBFC) and banking stocks. The BSE midcap gained 1.5% ,closing at the lifetime high of12057.27. The benchmark Sensex climbed nearly 500 points to trade at levels of 27,612.86 before closing at 27,626.69.

The BSE mid-cap index hit an all time high on Monday with a strong show by non-bank financial companies (NBFC) and banking stocks. The BSE midcap gained 1.5% ,closing at the lifetime high of12057.27. The benchmark Sensex climbed nearly 500 points to trade at levels of 27,612.86 before closing at 27,626.69.

Eight constituents of the BSE mid-cap index also hit a record high; the index includes several NBFCs such as Bajaj Finance, Shriram Transport Finance, Mahindra and Mahindra Financial Services, and LIC Housing Finance. Other stocks such as Berger Paints, JSW Steel, Hindustan Petroleum Corp and Yes Bank also soared to new highs during the day trade.

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Among BSE mid-cap stocks, Berger Paints (8%), Allahabad Bank (6.2%), Oriental Bank of Commerce (OBC) (5.9%) were the top gainers.A report by Motilal Oswal on banks said earnings, for the three months to June, can be expected to be better quarter-on-quarter.

“While provision levels are likely to remain elevated (due to the lag impact of higher stress addition and focus on improving balance sheet health at the cost of profitability), we believe increased activity on monetization of non-core assets, reduction in cost of funds and bond gains are likely to support earnings,” it said.

Apart from expectations of a cut in interest rate the rally in the mid-caps has also been driven by a pick-up in monsoon and hopes of passage of the GST (goods and services tax) Bill in the upcoming monsoon session of Parliament. Most other Asian markets closed on a strong footing following strong weekend rally in the US. Japan’s Nikkei remained at the forefront, jumping 3.98%, followed by Hong Kong’s 1.54%, Singapore’s 0.97% and the Shanghai Composite’s 0.23%.

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