Experts see higher volatility today, US Fed's stance to pause interest rate hike also boosted the sentiments
Bulls came out in full force a day ahead of the Interim Budget as investors were pumped up on positive expectations. Positive global cues and US Federal Reserve's stance to pause interest rate hike also boosted the sentiments.
Benchmark key indices Sensex and Nifty closed over 1.5% on Thursday with bank, IT and energy stocks seeing a strong rally.
BSE Sensex closed 665.44 points, or 1.87% higher at 36256.69, while NSE Nifty ended the session with a gain of 179.15 points, or 1.68% at 10830.95. Intraday, Sensex touched a high of 36278.13 and a low of 35740.07, whereas Nifty rose up to 10838.05 and saw a low of 10678.55.
According to Sameet Chavan, chief analyst - technical and derivatives, Angel Broking, the day started marginally higher and then remained a bit sluggish in the initial hour. But all of a sudden, strong buying emerged in the market, which accelerated as the day progressed.
Of the 30-stock BSE Sensex, only five scrips - YES Bank, HCL Technologies, Bajaj Finance, ICICI Bank and Coal India ended in red, with losses varying between 0.13% and 2.56%. The heavyweights such as Axis Bank (4.64%), Tata Motors (3.99%), Infosys (3.41%), Reliance Industries (2.7%), Kotak Mahindra Bank (2.6%) and HDFC Bank (2.39%) were major gainers.
“The kind of close we had, things started looking quite encouraging. For the coming session, we would advise staying light as we may see higher volatility on account of Union Budget. This hope rally must have come out of some positive expectation. If any announcement comes in-line with expectations, we may see this rally getting extended towards 10900–10940 or beyond also. On the flip side, 10740 followed by 10700 are likely to be seen as immediate supports,” Chavan said.
Hemang Jani, head -- advisory, Sharekhan by BNP Paribas, said the government might look to boost the rural and agri-sector in the interim Budget ahead of the general election. “Expect the government to go in for a populist Budget. However, market participants will closely weigh in the risk of a higher fiscal deficit and its impact on the market.”
Standard Chartered in its report said key benchmark indices ended with strong gains led by index heavyweights Reliance Industries, HDFC Bank and Infosys.
“Intra-day volatility was high due to F&O (futures and options) contracts expiry of January 2019 series. Among secondary barometers, the S&P BSE MidCap index rose 0.4% and the S&P BSE SmallCap index rose 0.8%, underperforming the Sensex. The market breadth, indicating the overall health of the market, was positive,” it said.
The European markets rose as a dovish turn in the Fed's policy statement and higher oil prices helped investors shrug off weak manufacturing data from China as well as mixed earnings reports, the report added.
Motilal Oswal in its report said there was rally in the market on account of short covering ahead of the Budget announcement and strong global cues. Moreover, markets surged across the globe after the US Fed kept unchanged interest rate and said it will be "patient" on future interest rate moves and signalled flexibility on the path for reducing its balance-sheet. Asian markets closed at near four-month highs and European markets gained 1% on hope of reduced trade tension between China and the US.
CHARGED UP FOR BIG DAY
- Only 5 – Of 30 Sensex stocks ended in red on Thursday
- Rs 3,006.41 cr – Shares foreign portfolio investors bought on a net basis, as per provisional data on Thursday
- Rs 1,634.32 cr – Shares domestic institutional investors sold
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Of the 30-stock BSE Sensex, only five scrips - YES Bank, HCL Technologies, Bajaj Finance, ICICI Bank and Coal India ended in red, with losses varying between 0.13% and 2.56%. The heavyweights such as Axis Bank (4.64%), Tata Motors (3.99%), Infosys (3.41%), Reliance Industries (2.7%), Kotak Mahindra Bank (2.6%) and HDFC Bank (2.39%) were major gainers.
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