The Sensex jumped over 200 points in the opening session on Wednesday led by gains in metal, auto, IT and energy stocks amid recovery in global equities.
— CNBC-TV18 (@CNBCTV18Live) January 29, 2020
The 30-share BSE index was trading 214.51 points or 0.52 percent higher at 41,181.37. Similarly, the broader NSE rose 71.35 points, or 0.59 percent, to 12,127. In the previous session, Sensex settled 188.26 points, or 0.46 percent, down at 40,966.86, and Nifty closed 63.20 points, or 0.52 percent, down at 12,055.80, according to PTI.
Tata Steel was the top gainer in the Sensex pack, rising over 2 percent, followed by Infosys, M&M, Bharti Airtel, Maruti and Hero MotoCorp.
On the other hand, TCS and HDFC slipped in the red.
Besides recovery in global equities, the domestic market rose on hopes of an economic revival in the upcoming budget, traders said.
Further, short-covering ahead of January derivatives expiry also lifted key indices, they added.
Rupee trades higher
The Indian rupee appreciated by 10 paise to 71.21 against the US dollar in early trade on Wednesday tracking gains in domestic equity market, according to a PTI report.
— CNBC-TV18 (@CNBCTV18Live) January 29, 2020
Forex traders said the rupee is trading in a narrow range amid fast-spreading coronavirus outbreak in China stoking fears about more trouble for the global economy.
At the interbank foreign exchange, the rupee opened at 71.23, then gained further ground and touched a high of 71.21 against the US dollar, registering a rise of 10 paise over its previous close.
On Tuesday, the rupee had settled for the day at 71.31 against the US dollar.
Foreign institutional investors (FIIs) remained net sellers in the capital market, as they sold shares worth Rs 1,357.56 crore on Tuesday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, rose 1.36 per cent to trade at 60.32 per barrel.
However, strengthening of the American currency vis-a-vis other currencies overseas weighed on the rupee.
The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.01 per cent to 98.02.
The 10-year government bond yield was at 6.59 per cent in morning trade.
Meanwhile, on the global front, the United States said Tuesday it was developing a vaccine against a deadly virus that originated in China. PTI
Asian shares turn red as Hong Kong tumbles on China virus
Asian shares erased earlier gains on Wednesday, swinging into negative territory as a spike in new Chinese virus cases sent Hong Kong stocks tumbling and fuelled fears about economic impact of the outbreak, according to Reuters.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 0.52 percent. Hong Kong shares fell 2.8 percent on their first session after a two-and-a-half trading daybreak for Lunar New Year, led by declines in financial services, real estate, and consumer goods companies.
However, Australian shares rose 0.57 percent, while Japan's Nikkei stock index rose 0.4 percent, partly because investors in these markets has already had a chance to react to the virus outbreak, which has claimed more than 100 lives.
Oil futures extended gains in Asia after OPEC sources said the cartel wants to extend crude output cuts by three months to June, easing concern about excess supplies.
US Treasury yields remained higher and safe-haven currencies held steady in a sign of some calm in financial markets, but the focus remained squarely on the virus and how investors would re-price riskier assets.
“The next three to five days will be maximum selling pressure, because essentially markets had a benign view of the virus before the Lunar New Year,” said Sean Darby, global equity strategist at Jefferies in Hong Kong.
“Until the rate of cases starts to peak, markets are not likely to bounce.”
US stock futures rose 0.14 percent in Asia on Wednesday. The S&P 500 rose 1.01 percent on Tuesday, rebounding from its worst daily decline in four months on Monday, as shares of Apple Inc ahead of its fourth-quarter results.
After the market close, Apple reported better-than-expected profits for the fourth quarter and forecast revenue in the current quarter above Wall Street expectations, which lifted some Asian tech shares.
The yield on benchmark 10-year Treasury notes rose to 1.6666 percent versus a yield of 1.5821 percent on three-month Treasury bills in another sign that sentiment has stabilised.
The yield curve briefly inverted on Tuesday when 10-year yields fell below their 3-month counterparts for the first time since October. An inverted yield curve has historically been an indicator of looming recession.
Markets in Asia are likely to be subdued before the U.S. Federal Reserve meeting later on Wednesday. The Fed is expected to reiterate its desire to keep rates unchanged at least through this year.
In currency markets, the safe-haven yen was quoted at 109.22 per dollar following a 0.2 percent loss on Tuesday. The Swiss franc, another popular safe-haven, traded at 0.9740 versus the dollar, close to its lowest in almost three weeks.
In the offshore market, the yuan was little changed at 6.9615 per dollar. China’s onshore markets are closed for the Lunar New Year holidays. Markets will resume trading on 3 February.
US crude rose 0.99 percent to $54.01 a barrel. Brent crude rose 0.96 percent to $60.08 per barrel.
OPEC wants to extend current oil output cuts until at least June from March, with the possibility of deeper reductions on the table if oil demand in China is significantly impacted by the spread of a new coronavirus, OPEC sources said.
Sterling edged lower to $1.3021, on course for its fifth day of declines due to worries about Britain’s trading relationship with the European Union.
Investors are also cautious ahead of a Bank of England policy decision on Thursday, which many analysts say is too close to call.
--With inputs from agencies
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Updated Date: Jan 29, 2020 10:20:16 IST