MUMBAI: Halting a two-day losing streak, the benchmark BSE Sensex closed 150 points higher on Wednesday, driven by a rally in IT stocks amid a surge in US markets fueled by renewed hopes of a rate cut by the Federal Reserve in September.
Equity markets in India will remain closed on Thursday for Independence Day.
The 30-share BSE Sensex rose 149.85 points, or 0.19 per cent, to settle at 79,105.88, with half of its constituents closing in the green. During the session, it gained as much as 272.91 points, or 0.34 per cent, reaching a high of 79,228.94.
The NSE Nifty ended the day marginally up by 4.75 points, or 0.02%, at 24,143.75, with 26 Nifty shares declining and 24 advancing.
The domestic market traded within a narrow range, despite a positive turnaround in global markets. The IT index edged up, reflecting optimism about improved US CPI data expected later today, which could increase the likelihood of a more accommodative monetary policy from the Fed,” according to a market expert.
Losers and gainers
Among the Sensex constituents, Tata Consultancy Services led the gains, rising 2.3 per cent, followed by HCL Technologies, Tech Mahindra, Infosys, Mahindra & Mahindra, and Tata Motors. Conversely, UltraTech Cement, JSW Steel, Tata Steel, Adani Ports, Power Grid, and Bajaj Finserv were among the laggards.
Mining stocks declined after the Supreme Court rejected the Centre’s plea to apply its July 25 verdict prospectively, which upheld the power of states to levy taxes on mineral rights and mineral-bearing land, and allowed them to seek a refund of royalty payments from April 1, 2005, onwards. As a result, NMDC fell 6 per cent, Hindustan Copper dropped over 4 per cent, and Nalco declined by 2.7 per cent.
“The Producer Price Index (PPI) data from the US indicates a softening of inflation, and confirmation of this declining trend is likely to come from the CPI data expected today. The US market surged yesterday in anticipation of this and a potential rate cut by the Fed in September,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, was quoted as saying.
BSE smallcap Index
In the broader market, the BSE smallcap index declined 0.57 per cent, while the midcap index dipped 0.41 per cent. Among sectoral indices, the IT index jumped 1.41 per cent, tech rose 1.33 per cent, consumer durables edged up 0.13 per cent, and consumer discretionary gained 0.09 per cent.
Commodities, energy, telecommunication, utilities, metal, power, realty, and services indices were the underperformers.
Other Asian markets
In Asian markets, Seoul and Tokyo ended higher, while Shanghai and Hong Kong closed lower.
European markets were trading in positive territory, and U.S. markets had ended significantly higher on Tuesday.
Foreign Institutional Investors (FIIs) sold equities worth Rs2,107.17 crore on Tuesday, while Domestic Institutional Investors (DIIs) bought equities worth Rs1,239.96 crore, according to exchange data.
Global oil benchmark Brent crude climbed 0.59 per cent to $81.17 per barrel.
