Sensex surges over 800 points in morning session, Nifty regains 11,900-mark; RIL, HDFC, ITC lead amid firm global cues

  • Sensex surged over 400 points in morning session on Tuesday led by gains in index-heavyweights Reliance Industries, HDFC twins and ITC amid firm global cues.

  • In the previous session, Sensex rose 136.78 points or 0.34 per cent to settle at 39,872.31, and Nifty gained 46.05 points or 0.39 per cent to close at 11,707.90

  • The rupee appreciated 17 paise to 71.20 against the US dollar in morning session.

Sensex surged over 800 points in morning session on Tuesday led by gains in index-heavyweights Reliance Industries, HDFC twins and ITC amid firm global cues. Reclaiming the 40,000-mark, the 30-share BSE index was trading 802.96 points or 2.01 percent higher at 40,675.27 at around 11.30 am.

Similarly, the broader NSE advanced 236 points, or 2.02 percent, to 11,943.90.

In the previous session, Sensex rose 136.78 points or 0.34 per cent to settle at 39,872.31, and Nifty gained 46.05 points or 0.39 per cent to close at 11,707.90. Meanwhile, on a net basis, foreign institutional investors sold equities worth Rs 1,200.27 crore, while domestic institutional investors purchased shares worth Rs 1,286.63 crore on Monday, data available with stock exchanges showed. HDFC was the top gainer in the Sensex pack, rising up to 2.5 percent, followed by Reliance Industries, UltraTech Cement, Hero MotoCorp, ITC, IndusInd Bank and HDFC Bank.

On the other hand, Bajaj Auto, HUL, Nestle India and Asian Paints were trading in the red.

According to analysts, market finding some ground after a disappointing Union Budget. Besides, manufacturing activity hitting an eight-year high eased investor concerns over economic recovery.

 Sensex surges over 800 points in morning session, Nifty regains 11,900-mark; RIL, HDFC, ITC lead amid firm global cues

Representational image. Reuters.

Further, positive opening of other Asian stocks too buoyed domestic benchmarks, traders said.

The rupee appreciated 17 paise to 71.20 against the US dollar in morning session.

Rupee rises 19 paise to 71.19 

The rupee appreciated by 19 paise to 71.19 against the US dollar in opening trade on Tuesday, driven by positive opening in domestic equities.

The rupee opened strong at 71.24 at the interbank forex market then gained further ground to touch 71.19 per dollar, displaying gains of 19 paise against the greenback.

Forex traders said concerns over fiscal slippage and rising coronavirus outbreak fears still remain.

The next trigger for the currency will be the Reserve Bank of India's monetary policy meeting, as its commentary on inflation and well as growth forecast would be keenly watched, they said.

Asian stocks bounce reversing previous losses

Asian stocks bounced on Tuesday with Chinese markets reversing some of their previous plunge amid official efforts to calm virus fears, although sentiment remained fragile with oil near 13-month lows, according to Reuters.

The total number of coronavirus deaths in China reached 425 as of the end of Monday, from 20,438 cases.

China’s central bank has flooded the economy with cash while trimming some key lending rates, but analysts suspect more will have to be done to offset the economic fallout from the virus.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.0 percent, led by gains in South Korea .KS11 and Australia . Japan's Nikkei inched up 0.1 percent.

“Given the extent of the shutdowns in China as well as the rapid rise in the virus that is likely to continue through March or April, a significant hit to China and regional growth is very likely,” said JP Morgan economist Joseph Lupton.

“We would assume that in addition to bridging any funding stresses, fiscal policies will need to be ramped up to support growth once the contagion gets under control.”

The Shanghai Composite .SSEC stood flat in choppy early trading, while the blue-chip CSI300 rebounded 0.9 percent, one day after an almost 8 percent slide on Monday as markets resumed from the Lunar New Year holiday. Hong Kong's Hang Seng advanced 0.7 percent.

“Chinese authorities have been providing a lot of support for the financial markets. There’s a level of assurance that the rout would not be allowed to go on much further than necessary,” Christy Tan, head of markets strategy for Asia at National Australia Bank in Singapore.

“This could prove to be temporary if we see worse news or little sign of reaching containment of the (coronavirus) situation,” she added.

In an effort to stop the rout, China’s state-backed Securities Times published an op-ed on Tuesday to call on investors not to panic.

That followed moves by China’s securities regulator on Monday to limit short selling and stop mutual fund managers selling shares unless they face investor redemptions, according to Reuters.

E-Mini futures for the S&P 500 gained 0.3 percent, extending a 0.7 percent bounce overnight, even after disappointing earnings results from Alphabet Inc.

Wall Street had taken comfort in a surprisingly solid reading of US manufacturing and the Dow  ended Monday with a rise of 0.5 percent, while the S&P 500 gained 0.7 percent and the Nasdaq 1.3 percent.

“This is just a typical reversal after a big fall. Vague concerns about Wuhan virus are still weighing on US stocks,” said Masanari Takada, cross asset strategist at Nomura Securities in Tokyo.

Factory activity rebounded in January after contracting for five straight months amid a surge in new orders.

The ISM index rose to 50.9, the highest since July, from an upwardly revised 47.8, though the survey was taken before the virus spread in earnest.

The upbeat report nudged Treasury yields up from deep lows and gave the US dollar a modest lift.

In early Asian trade, oil futures staged a modest rebound, one day after slumping to the lowest in more than a year as the coronavirus outbreak curtailed Chinese demand.

Brent crude added 0.5 percent to $54.73 a barrel, while US crude gained 0.7 percent to $50.44.

A swath of commodities from copper to iron ore joined oil in the dumpster amid fears the drag on Chinese industry and travel would sharply curb demand for fuel and resources.

The Dalian Commodity Exchange’s most-traded iron ore futures contract, expiring in May, tumbling more than 5 percent in early trade.

In the currency market, the dollar firmed to 108.66 yen from an overnight low of 108.30, while the euro faded a fraction to $1.1059 EUR= but remained well within recent snug ranges.

Against a basket of currencies, the dollar bounced back to 97.837 from a trough of 97.406.

Sterling was nursing its wounds at $1.2987 having shed 1.6 percent overnight when the UK government laid out a tough opening stance for future trade talks with the European Union following its departure from the bloc last week.

The fall erased all the gains made after the Bank of England’s decision last week to keep interest rates on hold.

Spot gold was off at $1,576.34 per ounce, from a top of $1.591.46, as the dollar firmed and safe haven demand waned a little.

--With inputs from agencies

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

Updated Date: Feb 04, 2020 12:21:46 IST