Sensex Ends Above 37,000-Mark; Oil & Gas Stocks Outperform

Indian share markets ended with sharp gains followed by its Asian peers. At the closing bell, BSE Sensex ended up by 383 points, while, NSE Nifty ended up by 141 points.

Barring IT stocks, all sectoral indices ended in green with energy stockspower stocksconsumer durables stocks and metal stocks witnessing maximum buying interest.

Globally, Asian stock markets finished broadly higher today with shares in China leading the region. The Shanghai Composite is up 1.9% while Hong Kong's Hang Seng is up 1% and Japan's Nikkei 225 is up 0.5%. European markets are higher today with shares in London leading the region. The FTSE 100 is up 1% while Germany's DAX is up 0.1% and France's CAC 40 is up 0.1%.

Bank stocks ended the day on a positive note with Punjab & Sind Bank & Union Bank leading the gainers. As the largest lender in the country, State Bank of India (SBI) has plenty of firsts to its credit.

It added one more over the weekend with its decision to link a portion of its savings bank deposits as well as select loans to an external benchmark, the repo rate.

Incidentally, the Reserve Bank of India (RBI) in its fifth bi-monthly monetary policy statement in FY19 had recommended the use of an external benchmark for swifter transmission of policy rates.

RBI had suggested banks should price their floating rate retail/MSME loans based on an external benchmark.

SBI has decided to price savings accounts with deposits above Rs 1 lakh at 2.75% below the prevailing repo rate of 6.25%. The effective rate works out to be 3.5%, which is same as the prevailing rate.

But a closer look shows SBI is placating the regulator without hurting its shareholders. As on December 2018, the share of savings account deposits in total deposits was 38.9%. According to SBI, close to 33% of its savings bank deposits are above Rs 1 lakh. Essentially, the move would impact close to 12.8% of its total liabilities, the reports noted.

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