Sensex, Nifty continue to trade flat; Nifty PSU bank index down 2%

Bank stocks react to the merger proposed by the government for three banks

Mumbai.

The benchmark indices opened on a flat note on Tuesday amid no major development in the global markets.

Pharma, metal, energy stocks are providing some support to the indices, while PSU banks were down 0.7 percent in the early trade.

At 09:17 hrs IST, the Sensex was down 22.96 points or 0.06% at 37562.55, and the Nifty down 1.90 points or 0.02% at 11375.90. Bank of Baroda was down 10 percent, while Dena Bank gained 20 percent.

Equity benchmarks have continued to trade flat, with the Nifty trading below 11,400.

The Sensex is up 23.19 points or 0.06% at 37608.70, and the Nifty up 3.20 points or 0.03% at 11381.00. The market breadth is positive as 969 shares advanced, against a decline of 636 shares, while 96 shares were unchanged.

PSU banks are undergoing some pain, with the Nifty PSU bank index trading over 2 percent lower. Stocks in this space are reacting to the merger proposal by the government for three banks that was announced on Monday evening. Pharmaceuticals and FMCG names are trading in the green. Meanwhile, midcaps are trading flat.

After a massive run in last 5 days the selected sugar stocks are trading lower in today’s trade. Dalmia Bharat Sugar, Ugar Sugar Works, Dhampur Sugar Mills, Dwarikesh Sugar Industries, Uttam Sugar Mills and Avadh Sugar & Energy were down up to 8 percent.

The markets traded volatile on the expected lines and settled half a percent lower last week, citing mixed global cues and continued weakness in the rupee.

Shares of Bank of Baroda (BoB) dropped more than 10 percent, while Dena Bank and Vijaya Bank gained 10-20 percent after the government announced its proposal to merge the three public-sector banks (PSBs).

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