Indian equity indices Sensex and Nifty made a strong comeback on Thursday following buoyant investor sentiment and sustained buying in auto and metal stocks.
The US Federal Reserve cut interest rates by a quarter of percentage point during its two-day meeting, leading to gains in most global shares. Wall Street settled higher in overnight deals on Wednesday.
Rebounding from its early lows, the 30-share BSE Sensex climbed 426.86 points or 0.51 per cent, to settle at 84,818.13. During the day, it hit a high of 84,906.93 and a low of 84,150.19.
The 50-share NSE Nifty appreciated by 140.55 points, or 0.55 per cent, to close at 25,898.55. Following initial volatility, the Nifty gradually moved higher and closed near the day’s peak of 25,922.80 as most sectors advanced.
“Domestic markets rebounded broadly following the Fed’s expected 25-bps rate cut amid high US inflation. The decline in US 10-year yields indicates a moderation in future FII outflows, which bolstered sentiment,” said Vinod Nair, Head of Research, Geojit Investments Ltd.
Nair added that the auto sector excelled due to anticipated stronger demand, while IT gained traction on the prospect of increased spending.
Also Read: Sensex, Nifty close at month’s low after fag-end selloff
Among the Sensex constituents, Eternal, Tata Steel, Kotak Mahindra Bank, UltraTech Cement, Maruti Suzuki India, Sun Pharmaceuticals, Tech Mahindra, HDFC Bank, Tata Motors Passenger Vehicles, Infosys, Trent, Mahindra & Mahindra, Reliance Industries and HCL Technologies were the gainers.
However, Asian Paints, Bharti Airtel, Bajaj Finance, PowerGrid, Axis Bank, ICICI Bank and Titan were among the laggards.
Conversely, other Asian markets experienced selling pressure over concerns about AI-driven valuations and rising Japanese yields, which negatively impacted overall domestic sentiment.
Ajit Mishra – SVP, Research, Religare Broking Ltd said buying across IT, auto, metals, realty and banking helped offset recent weakness, supported by a decline in India VIX.
“Steady domestic sentiment was reinforced by robust equity inflows of ₹29,894 crore in November. However, continued weakness in the rupee capped the momentum,” he added.
In Asian markets, Japan’s Nikkei 225 benchmark, Shanghai’s SSE Composite, South Korea’s KOSPI and Hong Kong’s Hang Seng settled lower. But, European markets were trading higher.
Meanwhile, Foreign Institutional Investors (FIIs) remained the net sellers of equities worth ₹1,651.06 crore on Wednesday while Domestic Institutional Investors (DIIs) bought stocks worth ₹3,752.31 crore, according to the exchange data.
Brent crude, the global oil benchmark, declined 1.22 per cent to USD 61.45 per barrel.
On Wednesday, the 30-share BSE Sensex dropped by 275.01 points to settle at 84,391.27, while the broader NSE Nifty fell by 81.65 points to close at a month's low of 25,758.
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