NEW DELHI: Most of the PSU bank stocks were trading with gains during early trade on Tuesday after the Reserve Bank of India allowed public-sector lenders to spread their bond trading losses, incurred in the December 2017 and March 2018 quarters, equally over four quarters.

This move is expected to boost profitability of the lenders who have been grappling with headwinds lately.

The Nifty PSU Bank index was trading 2 per cent up at 2,911 around 10:15 am (IST) on Tuesday.

Shares of Union Bank of India (up 3.42 per cent), Bank of Baroda (up 3.10 per cent), Syndicate Bank (up 2.92 per cent), Bank of India (up 2.87 per cent) and State Bank of India (up 2.11 per cent) were the top gainers among the PSU bank stocks.

Shares of Indian Bank (up 1.77 per cent), IDBI Bank (up 1.69 per cent), Canara Bank (up 1.46 per cent), Oriental Bank of Commerce (up 0.96 per cent), Allahabad Bank (up 0.70 per cent) and Punjab National Bank (up 0.42 per cent) were also trading up.

Equity markets were trading flat tracking weakness in global markets.

The NSE Nifty50 index was down 2 points at 10,209, while the BSE Sensex was up 15 points at 33,270.

Among the 50 stocks in the Nifty index, 27 were trading in the green, while 23 were in the red.

HPCL, Indiabulls Housing Finance and Lupin were leading the pack of gainers in the Nifty index.