Markets rally on support from banks, strong global cues

The BSE Sensex advanced 107.98 points, or 0.33%, to 33,174.39 at close, while the NSE Nifty settled the day 53.50 points or 0.53% higher on Tuesday.

business Updated: Mar 27, 2018 17:45 IST
Press Trust of India, Mumbai
Sensex today,BSE Sensex,Nifty 50
Short-covering by speculators ahead of March F&O expiry, and an appreciating rupee against the dollar added to the upmove on the BSE.(Hemant Mishra/Mint)

Indian stock market remained buoyant for a second straight session, with the BSE Sensex closing 108 points higher, as banking shares rallied following a surprise cut in the government’s borrowing programme and investor sentiment improved on signs of easing global trade war fears.

Banking stocks were the session’s biggest gainers, with the PSU lender SBI emerging on the top in the BSE Sensex pack.

After a sharp fall over the last few sessions, Indian equities have seen some recovery in the past two sessions.

Trading sentiment got a massive lift in the wake of the government’s announcement to borrow Rs 2.88 lakh crore in the April-September period of 2018-19, lower than Rs 3.72 lakh crore it had borrowed in the first half of the current fiscal.

| Read: Govt to borrow only 47.5% of budgeted amount in H1 FY19: Economic affairs secretary

Reports on renegotiation of tariffs between the United States and China eased trade war concerns and lifted global equities.

Short-covering by speculators ahead of March F&O expiry and fiscal deficit data to be released tomorrow added to the positivity.

Market participants also took note of the finance ministry’s statement on Monday, which said India is on track to doubling the size of its economy to $5 trillion by 2025, while asserting that the inflation target set by the Reserve Bank will not be breached.

The country is well poised to click a growth rate of 7-8%, and with a focus on start-ups, MSMEs and infrastructure investment, it can step onto a higher growth pedestal, Economic affairs secretary, Subhash Chandra Garg,said.

“Indian markets started the day on a buoyant note as investor sentiment became positive on strong global cues, amid reports of trade negotiations between the United States and China. Investors’ risk appetite improved as fears of a trade war eased...,” Karthikraj Lakshmanan, Senior Fund Manager -Equities, BNP Paribas Mutual Fund, said.

After a strong opening, the BSE Sensex hit a high of 33,371.04, before closing at 33,174.39, up 107.98 points, or 0.33%. It had gained almost 470 points in the previous session.

The 50-share NSE Nifty scaled a high of 10,207.90 intra-day but succumbed to profit-booking to finish at 10,184.15, up 53.50 points, or 0.53%. All sectoral indices, led by metals, PSU, oil & gas, banking and healthcare stocks were in the green.

Major gainers were SBI, Asian Paints, Power Grid, IndusInd Bank, Tata Steel, Kotak Bank, HUL, Maruti Suzuki and TCS ended in the positive zone.

Domestic institutional investors (DIIs) bought shares worth a net Rs 2,017.95 crore, while foreign portfolio investors (FPIs) sold shares of Rs 741.19 crore yesterday.

In the Sensex pack, SBI gained the most at 3.04%, followed by IndusInd Bank at 1.45%.

Other winners were Tata Steel 1.30%, Asian Paints 1.16%, HUL 1.10%, Maruti Suzuki 1.05%, TCS 1.02%, Coal India 0.92%, L&T 0.90%, Power Grid 0.74%, ONGC 0.53%, NTPC 0.53 Sun Pharma 0.35%, ITC 0.21% and Adani Port 0.12%.

However, Bharti Airtel fell 2.42% followed by Bajaj auto 1.27%, HDFC 0.58%, Hero Motocorp 0.57%, Wipro 0.49%, M&M 0.37%, Tata Motors 0.30%, Infosys 0.13%, RIL 0.12% and Dr Reddy’s 0.06%.

Among the banking sector stocks, PNB topped the chart with a rise of 3.66%, SBI 3.04%, Bank of Baroda 1.73%, IndusInd Bank 1.45%, Kotak Bank 1.25%, Axis Bank 0.94%, ICICI Bank 0.91% and Yes Bank 0.38%.

The Nifty PSU Bank index was 0.78% higher. Finance stocks such as M&M Financial Services rose by 4.30% followed by Shriram Transport Finance 2.18%, Bajaj Finance Ltd 1.74%, Power Finance Corporation 1.73% and LIC Housing Finance by 1.43%.

Shares of Punj Lloyd surged 12.23% to Rs 17.90 today after the company won a Rs 505.22 crore highway contract in Odisha from NHAI.

Among sectoral indices, metal jumped the most at 1.68%, followed by PSU 1.66%, oil & gas 1.06%, bankex 0.93%, healthcare 0.93%, capital goods 0.90%, power 0.71%, infrastructure 0.69%, FMCG 0.67%, consumer durables 0.39%, IT 0.38%, realty 0.28% and auto 0.22%.

Broader markets too were in better shape, with the BSE smallcap index gaining 1.36% and mid-cap spurting 1.06%.

Crude oil prices were firm, supported by concerns that tensions in the Middle East could lead to supply disruptions, although further rises expected in US crude output loomed over markets. US West Texas Intermediate (WTI) crude futures were at USD 65.76 a barrel, up 0.32%, from their previous settlement. Brent crude futures were at USD 70.42 per barrel, up 0.43%.

In the global markets, Asian share markets rose sharply today as reports of behind-the-scenes talks between the United States and China rekindled hopes that a damaging trade war could be averted.

In the Asian region, Japan’s Nikkei climbed 2.65%, Hong Kong’s Hang Seng index rose 0.79%, while China’s Shanghai Composite Index was up 1.05% and Singapore rose 0.74%.

European indices were trading firm in their late morning session. Frankfurt’s DAX rose 1.73%, while Paris CAC 40 was higher 1.33%. London’s FTSE too edged higher 1.64%.

First Published: Mar 27, 2018 10:29 IST