Sensex jumps over 200 points, Nifty up 46 points in opening trade; HDFC, Infosys, RIL among top gainers

  • Sensex jumped over 200 points on Wednesday tracking gains in index heavyweights HDFC twins, Infosys and Reliance Industries as global stocks recovered from the previous day's losses

  • The rupee appreciated by 3 paise to 71.18 against the US dollar in early trade on Wednesday as easing crude oil prices and gains in domestic equity market lift investor sentiments

  • On Wall Street overnight, the Dow Jones Industrial Average fell half a percent and the S&P 500 dropped almost a third of a percentage point, led by falls in airlines and China-exposed casino operators

Sensex jumped over 200 points on Wednesday tracking gains in index heavyweights HDFC twins, Infosys and Reliance Industries as global stocks recovered from the previous day's losses.

The 30-share BSE index was trading 204.30 points or 0.49 percent higher at 41,528.11.

 Sensex jumps over 200 points, Nifty up 46 points in opening trade; HDFC, Infosys, RIL among top gainers

Stock brokers. Representational image. Reuters.

Similarly, the broader NSE was trading 46.70 points, or 0.38 percent, up at 12,216.55.

In the previous session, Sensex settled 205.10 points, or 0.49 percent, lower at 41,323.81; while the Nifty settled 54.70 points, or 0.45 percent, lower at 12,169.85.

Infosys was the top gainer in the Sensex pack, rising up to 1.46 percent, followed by Bharti Airtel, SBI, Sun Pharma, TCS, Bajaj Finance, HCL Tech, RIL and HDFC duo, according to a PTI report.

On the other hand, ONGC, NTPC, PowerGrid, Asian Paints and Hero MotoCorp fell up to 2.61 percent.

According to traders, domestic investors turned positive following recovery in other Asian markets after a day of massive selloff after the outbreak of a new deadly virus in China.

Rupee gains 3 paise against dollar

The rupee appreciated by 3 paise to 71.18 against the US dollar in early trade on Wednesday as easing crude oil prices and gains in domestic equity market lift investor sentiments.

However, a strong US dollar against major global currencies capped gains of the domestic unit, dealers said.

At the interbank foreign exchange market, the rupee opened strong at 71.17 and further gained slightly to hit a high of 71.16 against the greenback.

The domestic unit had settled at 71.21 against the American currency on Tuesday.

The dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.13 percent to 97.65.

Foreign institutional investors sold equities worth Rs 50.08 crore on a net basis on Tuesday, provisional exchange data showed.

The 10-year Indian government bond yield was at 6.64 percent.

China stocks tumble; regional stocks steady

Asian stock markets bounced on Wednesday as China’s response to a virus outbreak tempered fears of a global pandemic, although Shanghai shares slipped amid worries about a hit to domestic demand and tourism, according to a Reuters report.

Fears of contagion, particularly as millions travel for Lunar New Year festivities, has pushed stocks from record peaks.

The outbreak has revived memories of the Severe Acute Respiratory Syndrome (SARS) epidemic in 2002-03, a coronavirus outbreak that killed nearly 800 people and hurt world travel.

Yet this time, China’s response and candour—in contrast to the initial cover-up of the SARS outbreak—has tempered some of the gravest fears about the possible global fallout.

China’s National Health Commission said on Wednesday there were 440 cases of the new virus, with nine deaths so far. Measures are now in place to minimise public gatherings in the most-affected regions.

The Shanghai Composite index recovered from an early 1.4 percent drop to trade 0.5 percent lower by mid-morning. Markets elsewhere advanced, driving the MSCI index of Asia-Pacific shares outside Japan up 0.5 percent.

Japan's Nikkei, Korea's Kospi index and Hong Kong's Hang Seng .HSI all rose by more than half a percentage point after heavy drops on Tuesday. Australia's S&P/ASX 200 shrugged off worries to hit a fresh record high.

“The call here is not that the virus is done or nipped in the bud by any means,” said Kay Van-Petersen, global macro strategist at Saxo Capital Markets. “But there have been no big further reported outbreaks, and the response from the Chinese authorities has been very, very positive...China is 1.4 billion people. This is not the first time they’re tackling a bug that’s gotten out of hand.”

The outbreak, from its origin in Wuhan, China, has reached the United States, Thailand, South Korea, Japan and Taiwan.

Cases have been confirmed in 13 Chinese provinces.

The World Health Organization (WHO) meets later on Wednesday to consider whether the outbreak is an international emergency.

SARS flashback

Airlines, other travel-exposed stocks and retailers vulnerable to shifts in consumer sentiment have borne the brunt of selling in the past two days along with the Chinese yuan.

MSCI’s airline industry index posted its biggest daily drop in more than three months on Tuesday and shares in the industry were still falling on Wednesday.

On Wall Street overnight, the Dow Jones Industrial Average fell half a percent and the S&P 500 dropped almost a third of a percentage point, led by falls in airlines and China-exposed casino operators.

“While details on the coronavirus are scant, we reckon that the SARS period could offer some clues as to how markets could pan out,” said analysts at Singapore’s DBS Bank. “The trends are clear: Yields and stock prices fell in the first few months of the SARS outbreak and rebounded thereafter.”

So far, the yield on US 10-year government bonds has stabilised after Tuesday’s drop, sitting a little firmer at 1.7865 percent.

Spot gold also gave back some gains to hold 0.3 percent weaker at $1,553.01 per ounce.

In currencies, the safe-haven yen eased slightly from the one-week high it touched overnight, although the yuan nursed its losses. It was steady at 6.9026 per dollar.

Oil prices also settled back as traders figured a well-supplied global market would be able to absorb disruptions that have cut Libya’s crude production to a trickle. .

Brent LCOc1 futures settled down 20 cents at $64.59 a barrel. U.S. crude CLc1 fell 20 cents, or 0.3%, to $58.38 per barrel.

--With inputs from agencies

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Updated Date: Jan 22, 2020 10:19:00 IST