Sensex surges 266 pts tracking global cues after US Fed keeps rates steady
Trading sentiment got a boost after the current account deficit narrowed sharply to just $300 million, or 0.1% of GDP in the June quarter
Mumbai: Market benchmark Sensex rebounded by 266 points Thursday to close at over two-week high of 28,773.13 and the NSE Nifty went past the 8,800-mark, tracking upbeat global cues after the US Federal Reserve left rates unchanged.
Moreover, trading sentiment got a boost after the current account deficit (CAD) narrowed sharply to just $300 million, or 0.1 percent of GDP in the June quarter, driven by lower trade deficit on the back of deeper import contraction.
The rally in domestic equities was largely in line with the upmove seen in global stocks driven by the US Federal Reserve's decision not to lift interest rates.
Aurobindo Pharma surged over 6 percent as the company received tentative approval from the USFDA to manufacture and market Dolutegravir, used for the treatment of HIV, in the US.
However, select software exporter stocks, like TCS and Wipro, saw selling pressure following weakness in the dollar against the rupee. Software exporters' almost 60 percent revenue comes from the US and European markets.
"Markets praised Fed's decision as the global bond yield reverted and rupee strengthened. Due to a neutral statement, the market believe that the risk for 16 December rate hike is roughly balanced adding positive sentiment," said Vinod Nair, Head of Research, Geojit BNP Paribas Financial Services.
The 30-share Sensex after scaling the day's high of 28,871.92, closed 265.71 points or 0.93 percent higher at 28,773.13, a level last seen on 9 September, when it had
closed at 28,797.25.
The 50-share NSE Nifty reclaimed the key 8,800-mark to hit a high of 8,893.35 before winding up at 8,867.45 points, up by 90.30 points, or 1.03 per cent.
Both the indices, Sensex and Nifty, posted their biggest single day gains since 6 September. Meanwhile, the government today appointed three members on the Monetary Policy Committee (MPC), who along with RBI nominees are likely to set the benchmark interest rate in the upcoming monetary policy review with a view to contain retail
inflation at the targeted level of 4 percent.
Broader markets too displayed a bullish trend with mid-cap and small-cap indices rising 1.39 percent and 1 percent, respectively, as investors widened their portfolios.
Asian stocks ended up with key indices like China, Hong Kong, South Korea and Taiwan rising by 0.07 percent to 0.67 percent. Europe was higher too as indices in France, Germany and the UK jumped by up to 1.65 percent.
Back home, of the 30-share Sensex pack, 23 scrips ended higher.
Other major gainers were Adani Ports (2.06 percent), Asian Paints (1.97 percent), NTPC (1.95 percent), Tata Steel (1.90 percent), L&T (1.88 percent), Power Grid (1.74 percent) and HDFC (1.71 percent).
However, TCS fell 1.49 percent followed by Lupin 1.17 percent, Axis Bank (1.01 percent), Coal India (0.77 percent), Dr Reddy's (0.45 percent) and Wipro (0.36 percent).
Among BSE sectoral and industry indices, finance rose by 1.65 percent followed by oil & gas 1.51 percent, bankex (1.49 percent), auto (1.44 percent), capital goods (1.37 percent), power (1.36 percent), utilities (1.35 percent) and energy (1.30 percent).
However, IT fell 0.36 percent followed by teck (0.12 percent). The market breadth remained positive as 1,695 stocks ended higher, 1,044 finished in red while 234 ruled steady.
The total turnover rose to Rs 3,311.63 crore, up from Rs 3,180.94 crore yesterday.
The lesser than expected correction in Chinese shares is a short term breather for the markets, the report by a team led by Abheek Barua said
Both the 50,000 and 60,000 levels have been breached in 2021, showing the resilience of the market after the pandemic-triggered crash in March 2020
During the last week, BSE jumped 710 points or 1.21 percent, while market benchmark Sensex scaled the 59,000-mark for the first time