Sensex settles 416 points higher at 31,743, Nifty below 9,300-mark; IndusInd Bank, Britannia among major gainers

At close, the Sensex was up 415.86 points or 1.33 percent at 31743.08, and the Nifty was up 127.90 points or 1.40 percent at 9282.30. About 1,286 shares have advanced, 1076 shares declined, and 180 shares are unchanged.

FP Staff April 27, 2020 16:23:31 IST
Sensex settles 416 points higher at 31,743, Nifty below 9,300-mark; IndusInd Bank, Britannia among major gainers

Sensex and Nifty, the benchmark indices ended higher but selling in the last hour pulled the Nifty below 9,300 level led by gains in financial stocks. RBI's Rs 50,000-crore stimulus to mutual funds and positive cues from global markets buoyed investor sentiment.

At close, the Sensex was up 415.86 points or 1.33 percent at 31743.08, and the Nifty was up 127.90 points or 1.40 percent at 9282.30. About 1,286 shares have advanced, 1076 shares declined, and 180 shares are unchanged.

Abhishek A Rastogi, Partner at Khaitan & Co, said, the "RBI announced liquidity measures of approximately Rs 50,000 crore for Mutual Funds. This has given some necessary investor confidence and has resulted in positive sentiment. The mid-session performance was decent based on the announcements and even the day closed pretty well with the banks gaining a lot. While more than a dozen of stocks touched a year low, few banks remained the top gainers to cover up the index. We will have to wait whether the multiplexes, etc which lost value will be able to recover in the near future."

IndusInd Bank, Britannia Industries, Bajaj Finserv, Axis Bank and Kotak Mahindra Bank were among major gainers on the Nifty, while losers were NTPC, HDFC Bank, M&M, Dr Reddy’s Labs and Grasim.

All the sectoral indices ended higher led by the bank, IT, auto and FMCG. BSE Midcap and Smallcap indices rose over 1 percent each.

Sensex settles 416 points higher at 31743 Nifty below 9300mark IndusInd Bank Britannia among major gainers

Deepak Jasani, Head Of Research, HDFC Securities said: "Equity markets ended the first trading day of the new week with gains, though off the high point of the day as selling came in the last hour of trade. The NSE Nifty 50 index rose 127.9 points or 1.4 percent to close at 9,282. Markets opened up after the RBI launched a special liquidity facility for mutual funds to ease the pressure due to the coronovirus pandemic.

"Asian stock markets gained Monday after Japan's central bank promised more asset purchases to shore up financial markets and more governments prepared to revive struggling economies by reopening businesses. The Bank of Japan said it will buy an additional 15 trillion yen ($140 billion) of commercial paper and bank loans, a "significant increase from the timid 2 trillion yen" in purchases announced in March.

"The bank also raised its ceiling on purchases of government debt. European stocks rose on Monday in anticipation of more central bank action and announcements of economies reopening.
Indian markets gained led by Private Banks, NBFCs, AMC and Life Insurance companies.

"Technically, with the Nifty rallying higher, the short term trend continues to remain up. Further upsides are likely once the immediate resistance of 9390 is taken out. Crucial supports to watch for any weakness are at 9250-9175," said Jasani.

Paras Bothra, President of Equity Research, Ashika Stock Broking, said: "Domestic markets scaled higher after a strong close on Wall Street Friday and amid hopes that the Modi government will allow parts of the country to start opening up soon particularly the areas in green & orange zones with limited COVID-19 cases. The government is also due to announce a fiscal stimulus and the RBI opened a special window for mutual funds after liquidity concerns intensified in the aftermath of winding up of six debt schemes by Franklin Templeton mutual fund. All sectoral indices ended in green with strong interest witnessed in finance & bank stocks. At close, the Sensex was up 415.86 points or 1.33% at 31743.08, and the Nifty was up 127.90 points or 1.40% at 9282.30.

The Indian market started the week on a positive note tracking positive Asian peers as hope for more monetary policy easing by global central banks gained further traction after Bank of Japan stepped up its stimulus to contain virus shock to its economy, Narendra Solanki, Head- Equity Research (Fundamental), Anand Rathi, said to PTI.

During the day the positive momentum further strengthened as the Reserve Bank of India announced a special liquidity facility of Rs 50,000 crore for mutual funds, with an aim to ease liquidity pressures on mutual funds, he added.

"With a view to easing liquidity pressures on MFs, it has been decided to open a special liquidity facility for mutual funds of Rs 50,000 crore," the RBI said.

The central bank also stressed that it is vigilant and will take whatever steps are necessary to mitigate the economic impact of COVID-19 and preserve the financial stability.

Some profit-booking at the fag-end of the session, however, pulled key indices from the day's highs, traders said.

On the currency front, the rupee rose 21 paise to provisionally close at 76.25 against the US dollar.

Asia shares rally as BOJ buys more bonds

Asian shares bounced on Monday as the Bank of Japan (BOJ) announced more stimulus steps to help cushion the economic impact of the coronavirus , but the recent weak run in the global oil price showed no signs of ending.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.8 percent, taking back a chunk of last week's 2.6 percent decline. Japan's Nikkei gained 2.6 percent, and Chinese blue chips 1 percent.

After a soft start, E-Mini futures for the S&P 500 climbed 0.85 percent, while EUROSTOXX 50 futures added 2.6 percent and FTSE futures 1.35 percent.

The BOJ matched market speculation by pledging to buy unlimited amounts of government bonds, removing its previous target of 80 trillion yen per year.

It sharply raised purchases of corporate and commercial debt, and eased rules for what debt would qualify.

Combined central bank and government actions around the world and falling rates of new coronavirus cases had helped spark some positive sentiment for equity investors, said Macquarie Private Bank divisional director Martin Lakos.

“People are cautious, but I think some investors are gauging that the worst might be over outside of another significant global outbreak of COVID-19 ,” Lakos said.

“Saying people are optimistic is probably too strong but there’s some confidence creeping back in to people’s thinking.”

Oil prices are on track for another soft week, with the commodity having fallen in eight of the last nine weeks. US crude led the decline amid fears of another storage squeeze that saw prices plunge into negative territory last week after a slump in demand due to the pandemic and a glut of supply.

US crude was down 11 percent at $15.07 a barrel, while Brent crude futures were down 3.9 percent at $20.60 a barrel

On the central bank front, the Federal Reserve and the European Central Bank meet later in the week, with the latter likely to do more bond buying.

“For the Fed, no further developments on QE or interest rates are expected, but we expect it to underline that its policies will be in place indefinitely to support the economy,” ANZ wrote in a research note.

Earnings season will be in full swing with around 173 companies in the S&P 500 reporting this week, including Apple, Amazon, Facebook, Microsoft, Caterpillar, Ford, General Electric and Chevron.

Analysts expect a 15% decline in S&P 500 first-quarter earnings, with profits for the energy sector estimated to slump more than 60%, raising fears of debt defaults, layoffs and possible bankruptcies.

Bond markets remain well supported by the truly massive easing under way from major central banks, which has seen U.S. 10-year yields trade around 0.6% for a week or more.

The dollar has been generally well bid thanks to its safe haven status as the world’s most liquid currency at times of stress, although moves have been relatively mild in recent weeks.

The dollar index touched a three-week high at 100.86 on Friday before easing back to 99.73 on Monday amid an improvement in risk appetite.

--With inputs from agencies

Updated Date:

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