Mumbai: After a brief pause, the equity markets resumed their upward journey led by bank and financial sector stocks amidst hope that the recent directive from the Reserve Bank of India to initiate bankruptcy proceedings against large loan defaulters would help the industry tide over the mounting bad debt problems in the coming months.
The GST council’s decision to provide certain relaxation in the timeline for filing returns to minimise the impact of transition to the GST also buoyed sentiments on the domestic bourses. The Nifty climbed above the psychological 9,600 level mark to end the trading session at 9,657.55 while the Sensex surged 255.17 points or 0.82 per cent to end the day at 31,311.57.
“The recent uncertainty surrounding the scheduled GST rollout on July 1, 2017, had pushed some investors on the sidelines. However, the GST council meeting over the weekend has reportedly addressed certain nagging issues and has put to rest speculation over a possible delay in the rollout. Investors responded to this update with cheer, which is evident in the positive activity that the markets witnessed on Monday,” said Karthikraj Lakshmanan, senior fund manager, equities, BNP Paribas Mutual Fund.
“The markets returned to their buoyant mood following the relaxation in return filing timeline to minimize the impact of transition to GST. On the other hand, RBI's insistence that the banks start the bankruptcy proceedings, which will improve bank’s asset quality and strengthen the balance sheet, led to a 1 per cent gain in the BSE Bank index,” added Vinod Nair, head of research at Geojit Financial Services.