The Sensex rallied over 400 points on Friday following positive cues from global markets on hopes of a trade deal between the US and China.
The 30-share index was trading 414.38 points, or 1.09 percent, higher at 38,294.78 at 0940 hours. Similarly, the broader NSE Nifty jumped 116.15 points, or 1.03 percent, to 11,350.70.
Top gainers in the Sensex pack during the early session included Vedanta, Tata Steel, ONGC, SBI, Kotak Bank, Tata Motors, ICICI Bank, HDFC twins and Infosys, rising up to 4 percent, PTI said.
On the other hand, TCS was the top laggard shedding up to 4 percent, after the largest software exporter on Thursday reported a tepid growth in net income for the September quarter at Rs 8,042 crore, and guided towards more challenges putting a big question mark over its ability to deliver the double-digit growth. Most brokerages cutting their price targets for the stock. TCS shares fell as much as 3.7 percent to Rs 1,929 per share on the BSE. At 9:34 AM, TCS' stock price was trading 3 percent lower at Rs 1,942, while the benchmark Sensex was up 0.7 percent or 284 points at 38,165, according to CNBC-TV18. The IT major reported a 1.8 percent year-on-year jump in Q2 net profit at Rs 8,042 crore. Revenue grew 5.8 percent to Rs 38,977 crore in the July-September quarter.
— CNBC-TV18 (@CNBCTV18Live) October 11, 2019
Tech Mahindra, Bharti Airtel, RIL and Sun Pharma were the other losers on the index, dropping up to 1 percent.
In the previous session, the BSE barometer ended 297.55 points, or 0.78 percent, lower at 37,880.40, and the Nifty fell 78.75 points, or 0.70 percent, to close at 11,234.55.
Foreign institutional investors (FIIs) remained net sellers in the capital market, pulling out Rs 263.11 crore on Thursday, while domestic institutional investors bought shares worth Rs 502.67 crore, data available with the stock exchange showed.
The market rallied in early session on Friday tracking gains in global markets after US President Donald Trump offered a positive assessment of US-China trade talks, traders said. "We just completed negotiation with China. We're doing very well. We're having another one tomorrow. I'm meeting with the Vice Premier over at the White House," Trump told reporters at the White House on Thursday.
Following the news, bourses in Shanghai, Hong Kong, Seoul and Tokyo were trading significantly higher in early trade.
Asian shares up on 'very good' trade talks
Asian shares rose on Friday after US President Donald Trump said he would meet with China’s top trade negotiator, stirring hopes for an agreement, while sterling was flat after earlier jumping on optimism over a potential Brexit deal.
Stocks on Wall Street too ended on a positive note on Thursday. Investors' renewed appetite for riskier assets continued to weigh on the safe-haven yen and US Treasury prices, while oil stayed firm on comments about possible supply cuts from the head of OPEC, reports Reuters.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1.2 percent, following on from gains on Wall Street. S&P e-mini futures ESc1 added more than 0.3 percent.
Australian shares climbed 0.8 percent, while Japan's Nikkei stock index gained 1 percent. Chinese blue-chip added 0.5 percent.
The bullish market mood came after the first day of trade talks between top US and Chinese negotiators, characterized by Trump as “very, very good.” A White House official said the talks had gone “probably better than expected” and a US Chamber of Commerce official briefed by both sides raised the possibility of a currency agreement this week.
Even before Trump's comments, hopes for an agreement helped to lift US markets.
The Dow Jones Industrial Average added 0.57 percent, the S&P 500 gained 0.64 percent and the Nasdaq Composite rose 0.6 percent. But while optimism around trade talks helped to drive a “classic risk-on session” overnight, the lack of runaway enthusiasm reflected broader investor caution, said Matt Simpson, senior market analyst at GAIN Capital in Singapore. “We know that it’s just a few words from Trump.”
Further positive developments in trade talks could boost markets on Monday, but low expectations for a deal mean that the lack of an agreement would not “necessarily (be) the end of the world for risk,” he added.
Analysts at National Australia Bank said freezing tariffs at current levels would be unlikely to reverse the trade-driven slowdown in economic growth. “The uncertainty around unresolved structural issues such as IP (intellectual property) theft and subsidies to state-owned enterprises are likely to remain deterrents for a pick-up in much needed capital expenditure. On this score details on a potential currency pact will be important,” they said in a morning note.
The rupee, meanwhile, appreciated 15 paise against its previous close to trade at 70.92 in early session.
— CNBC-TV18 (@CNBCTV18Live) October 11, 2019
The rupee opened at 70.8363 per dollar, up 23 paise from its previous close of 71.0663. At 9.05 AM, the rupee was trading at 70.8450, up 0.31 percent against the US dollar. In early trade, the rupee hit a high and a low of 70.8475 and 70.8075, respectively.
On Friday, the dollar was little changed against the yen at 107.98 while the euro gained 0.1 percent to buy $1.1015. The pound was slightly lower, fetching $1.2436, Reuters said.
The dollar index, which tracks the greenback against a basket of six major rivals, was down at 98.655 after posting its biggest daily drop in five weeks on waning safe-haven demand for the currency.
The British pound had jumped nearly 2 percent on Thursday, its biggest daily gain since March after Irish Prime Minister Leo Varadkar said a Brexit deal could be clinched by the end of October after what he called a very positive meeting with his British counterpart, Boris Johnson.
The move away from safe havens also lifted the yield on benchmark 10-year Treasury notes to 1.6733 percent compared with a US close of 1.656 percent on Thursday. Yields rose across the curve, with two-year notes US2YT yielding 1.5464 percent compared with a US close of 1.53 percent.
Brent futures, the global oil benchmark, rose 0.42 percent to $59.35 per barrel, according to a Reuters report.
In commodity markets, oil prices remained higher after the head of OPEC said the organisation could take action to balance oil markets, including a deeper cut in oil supplies, and amid hopes that progress toward ending the U.S.-China trade war could help to revive economic growth and lift fuel consumption.
US crude was up 0.52 percent to $53.83 a barrel and global benchmark Brent crude was up 0.49 percent at $59.39 per barrel.
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Updated Date: Oct 11, 2019 10:29:41 IST