NEW DELHI: Rally in select banking stocks took benchmark indices on Monday to another day of gains even as the volatility index climbed sharply amid decreasing hopes of an economic stimulus from the US.
Bluechip indices have rallied for seven straight days led primarily by IT and pharma stocks and now banking names, which have highest concentration in benchmark indices, are also participating giving wings to the rally. FMCG stocks also saw buying but auto and media names were subdued.
“We have achieved the 12,000 target this morning! The next level to watch out for would be 12,200-12,300. The support is now upgraded to 11,750-11,800. As long as the Nifty holds these levels, we are in bullish territory and every dip or correction can be utilised to accumulate long positions,” said Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments.
Factors driving markets
Stimulus hopes wane: The Donald Trump administration on Sunday called on Congress to pass a stripped-down coronavirus relief bill using leftover funds from an expired small business loan program as negotiations on a broader package ran into resistance.
Chinese shares surge: Investors in China are betting on the recovery in the country’s economy encouraged by a robust rebound in tourism and ebbing coronavirus cases.
How are bluechips doing
After opening with some gains, benchmark indices held on to their gains. At 9.42 am, BSE flagship Sensex was up 316.82 points or 0.78 per cent to 40,826.31. NSE benchmark Nifty followed, edging 79.40 points or 0.67 per cent higher to 11,993.60. During the day, Nifty reclaimed 12,000 mark for the first time since Feb 24.
In the 50-share pack Nifty, ITC was the biggest gainer, up 3.25 per cent as CLSA upgraded the stock, followed closely by SBI that also rose more than 3 per cent. Kotak Mahindra Bank, Power Grid and ICICI Bank were among other major gainers.
Tata Motors was the top loser in the pack, down 1.34 per cent. Titan, Hero Moto, Gail, HDFC Life and Bajaj Auto were among other major names that opened with cuts in Thursday’s trade.
Broader market indices also gained and were trading in-line with their headline peers as Nifty Smallcap rose 0.25 per cent while Nifty Midcap climbed 0.50 per cent. Broadest index on NSE, Nifty 500 was up 0.56 per cent.
Navin Fluorine, Shri Ram Transport Finance, Adani Gas, Thyrocare Tech, Amber Enterprises amd Trident were among major gainers from the space while Alok Industries, Suven Pharma, Rashtriya Chemicals, Future REtail, Zee Entertainment and Ashok Leyland were under selling pressure.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.8 per cent to 2-1/2-year highs, buoyed by a 2 per cent gain in Chinese blue chips and a 1.5 per cent rise by Hong Kong’s Hang Seng index. Japan’s Nikkei slipped 0.3 per cent as investors fretted about corporate earnings.
S&P 500 futures wobbled either side of flat in the Asia session, while European futures edged higher.
What to expect
Q2 earnings: Wipro, Indbank, Alexander Stamps and GNA Axles are among those that will declare their results during the day.
IPO listing: UTI AMC and Mazagon Dock will list today and the market will keep a keen eye on how they trade during the day.
Credit: Stocks-Markets-Economic Times