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equities: Indices rally on positive cues from Fed minutes

Mumbai: Indian equities made a dramatic surge in the last half hour of trade on Thursday – the last day of the November derivatives series – with two of the biggest gauges advancing over 1% led by information technology companies and the twins. The Sensex hit an all-time high – closing above 62,000 for the first time – and the Nifty crossed 18,500 intraday as the US Federal Reserve meeting minutes showed the rate-setting panel was more receptive to a slower pace of future rate hikes, giving a boost to bullish sentiment. A “substantial majority” of policymakers agreed it would “likely soon be appropriate” to slow the pace of interest rate hikes, according to the minutes of the November 1-2 meeting.

The BSE Sensex set a new intraday high of 62,412.33 before closing at 62,272.68, up 762.10 points, or 1.24%, from its previous close. The Nifty surged 216.85 points, or 1.19%, to close at 18,484.10. The previous highest close of the Sensex was 61,980.72 on November 16 this year, while the last intraday high was 62,245 on October 19, 2021. The Nifty’s previous record close was 18,477.05 on October 18, 2021 and the intraday high was 18,604.45 on October 19, 2021.

The final push to the indices on Thursday came from the rolling over of bullish derivative bets to the December series on expiry of the November contracts.

Brent Crude Oil Slips below $85 a Barrel

“All the pain points are receding, and everything appears to be falling in place compared with the situation two-three months ago. That is what is reflected in today’s movement,” said Raamdeo Agrawal, chairman, Group. “From one perspective, China markets have risen 15-20% in a month and that bodes well for Indian markets as it narrows the valuation gap because our market valuations are not cheap and earnings growth was slightly muted.

However, easing crude oil prices could give a boost to earnings growth going forward, he said, adding that markets are gradually rising and that’s a good sign.

Overnight, all three major US indices ended positive, extending previous day’s gains and setting an optimistic tone for the global markets. Key Asian indices rose 1%, while major averages across Europe were up 0.02-0.8% Thursday. The Stoxx Europe 600 – a pan-European gauge – was up 0.46%.

Brent crude oil slipped below $85 a barrel on Thursday. Oil prices fell more than 3% as the Group of Seven (G7) nations considered a price cap on Russian oil above the current market level and gasoline inventories in the US rose by more than analyst projections.

Foreign portfolio inventors (FPIs) bought Indian shares worth a net Rs 1,232 crore on Thursday, showed provisional data from the stock exchanges. So far this month, including Thursday’s provisional data, FPIs have purchased shares worth nearly Rs 21,712 crore.

The Bank Nifty touched a new high of 43,163.40 before closing at 43,075.40, up 346.30, or 0.81%.

Advancing stocks outnumbered declining ones on the NSE by a 1.51-to-1 ratio; on the BSE it was 1.23-to-1.

On Thursday, the VIX, a measure of the market’s anticipation of price fluctuations in the near term, closed at 13.47, the lowest since August 2021. The VIX touched a high of 33.97 in March, when the US Fed increased key lending rates for the first time.

Of the 30 Sensex companies, 26 ended in the green, led by

(2.93%). (2.59%), (2.56%), (2.43%), (2.39%) and (2.0%) were other top gainers. Mortgage lender HDFC advanced 1.99% while rose 1.68%.
, , and were the losing stocks, down 0.1-0.4%.

The broader markets also ended positive, with the BSE Mid- and Small-cap indices rising 0.52% and 0.42%, respectively. Barring consumer durables, all sectoral indices ended positive.

“I expect the broader markets to catch up. Investors are coming back,” said Vikaas M Sachdeva, managing director,

Alternate Assets. “The index is a reflection of the economic sentiment while the broader markets are a reflection of corporate earnings and growth is showing signs of a pick-up.”

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