Sensex bounces back 234 pts as Fed shows no rush to raise rates
Mumbai, October 9
Indian stocks shot up on Friday, with BSE Sensex recapturing its 27,000 point-mark after a day’s pause, tracking global cues as markets the world over responded positively to the possibility of a delay in rate hike by the US federal bank.
Buying ahead of the earnings season, which begins next week with Infosys scheduled to report second quarter numbers on Monday, also buoyed market sentiments.
Minutes of the last Federal Reserve meeting released on Thursday showed that officials were largely hesitant to hike rates for the first time in nearly a decade due to worries about global economy.
Asian and European shares got a leg up on confirmation that the US policymakers won't rush to tighten rates at a time of slackening global growth.
"US FOMC minutes did not giving a clear indication of a rate hike this year. Strong rupee, firm global markets and sharp rise in commodities worldwide were some of the key positives," said Gaurav Jain Director at Hem Securities.
The 30-share BSE Sensex opened higher at 26,974.92 on the back of strong showing in other Asian markets and hovered within the range of 27,200.44 and 26,910.59 before concluding at 27,079.51 —a gain of 233.70 points or 0.87 per cent.
On Friday, the Sensex dipped for the time in seven days after losing 190.04 points as participants locked-in gains in blue-chip stocks.
In early trade, after recapturing the 8,200-mark, the 50-share NSE Nifty touched a high of 8,232.20, but on profit- taking at higher levels, it slipped to close at 8,189.70, still up by 60.35 points or 0.74 per cent.
On weekly basis, both Sensex and Nifty surged 858.56 points (3.278 pc) and 238.80 points (3 pc), respectively — indexes second straight weekly rise.
Recovery in Sensex was supported by gains in Vedanta that zoomed 11.58 per cent, while Tata Steel surged 4.26 per cent.
Shares of housing finance firms gained as much as 9.69 per cent after Reserve Bank allowed lenders to offer loans up to 90 per cent for properties that cost up to Rs 30 lakh.
Among other Asian markets, indices in China, Hong Kong, Japan and Singpaore rose between 0.46 per cent and 1.75 per cent, while South Korea and Taiwan markets were closed.
European markets were also higher as key indices in France, Germany and the UK rose in the range 0.88 per cent to 1.18 per cent.
Pramit Brahmbhatt Veracity Group CEO said: "Price sensitive stocks and blue-chips gained on investors' confidence and short-covering. In the FOMC minutes released yesterday, the officials confirmed the delay in rate hike which boosted the confidence of investors."
Out of the 30-share Sensex pack, 18 scrips ended higher.
Major gainers were Vedanta (11.58 pc), Tata Steel (4.26 pc), Tata Motors (3.81 pc), Infosys (3.13 pc), ICICI bank (2.75 pc), ONGC (2.13 pc), GAIL (1.97 pc), Hindlaco (1.89 pc), Cipla (1.50 pc), Bharti Airtel (1.28 pc) and ITC (1.21 pc).
However, Coal India fell by 3.05 per cent followed by Maruti Suzuki 1.87 per cent, Sun Pharma 1 per cent and BHEL 0.88 per cent.
Among BSE sectoral indices, IT rose by 1.51 per cent, followed by teck 1.29 per cent, metal 0.99 per cent, capital goods 0.57 per cent, bankex 0.51 per cent and auto 0.42 per cent, while consumer durable fell by 0.18 per cent and power dropped 0.10 per cent.
The market breadth turned positive as 1,471 stocks ended in green, 1,304 closed in red while 124 ruled steady. The total turnover dropped further to Rs 2,878.40 crore from Rs 3,092.39 crore on Thursday. PTI
