Supported by gains in banking shares, NBFC, IT and auto heavyweights, benchmark indices Sensex and Nifty closed higher on September 13, .
After rangebound trade for majority of the session, markets recovered sharply in late afternoon session and gained nearly a percent amid volatility.
“News of payment default by an NBFC Altico Capital and mixed macroeconomic data were weighing on the sentiment while possibility of an interim deal between the US and China amid trade tussle and the announcement of quantitative easing program by the European Central Bank (ECB) eased some pressure,” said Ajit Mishra, Vice President – Research at Religare Broking.
Government data on September 12 showed India’s August retail inflation remained within the central bank’s target level of 4 percent, which bolstered the prospects of a rate cut by the RBI in its next policy meet.
“Strong possibility of a rate cut by the RBI in the next review meet triggered a sharp recovery in the rate-sensitive pack in the latter half,” Mishra added.
Positive global sentiment amid signs of easing US-China trade war and after the stimulus from the European Central Bank, rupee’s sustained rise against the US dollar and lower global crude oil prices were the other factors that played ball.
Sensex closed the day at 37,384.99, up 281 points, or 0.76 percent, with 25 stocks in the green and five – Bharti Airtel, Sun Pharma, HDFC Bank, ITC and Hindustan Unilever – in the red.
Vedanta, ICICI Bank, ONGC, Kotak Mahindra Bank, Axis Bank and State Bank of India emerged as the top gainers in the Sensex index.
Nifty closed 93 points, or 0.85 percent, higher at 11,075.90, with 41 stocks up and 9 down.
BSE Midcap (up 0.41 percent) underperformed Sensex whereas BSE Smallcap (up 0.82 percent) outperformed the equity benchmark.
Among the sectoral indices on BSE, only BSE Telecom and BSE Healthcare settled with losses, falling 0.53 percent and 0.38 percent, respectively.
The breadth of the market remained in the favour of gainers as 1,513 stocks logged gains against 960 that suffered losses on BSE.
Today’s rally in the market shot up the cumulative market capitalisation of BSE listed firms to Rs 1,42,42,949.76 crore from Rs 1,41,29,274.36 crore on September 12, making investors richer by Rs 1.14 lakh crore in a single day.
On a weekly basis, both Sensex and Nifty advanced by over a percent.
Top news of the day:
Delhi Chief Minister Arvind Kejriwal, as a part of 7-point plan to combat rising pollution levels during the Diwali season, has announced that the Odd-Even scheme will be reintroduced this year in the capital.
The Interpol has issued a Red Corner Notice (RCN) against Nehal Modi, brother of Nirav Modi, the main accused in the USD 2 billion PNB scam case, PTI reported.
The International Monetary Fund (IMF) has cited corporate and environmental regulatory uncertainty and “lingering weakness” in some non-bank financial companies as reasons for India’s “much weaker” than expected economic growth, reported news agency ANI.
The Reserve Bank of India is expected to go for a further rate cut in the next month’s monetary policy review, experts say.
Union minister Hardeep Singh Puri said the construction work on the government’s mega plan to redevelop the Parliament Building, Central Vista and a composite complex for various ministries may begin by next year, reported PTI.
Stocks in news:
Shares of PI Industries rallied 4.36 percent to Rs 1,296.45 on BSE on September 13 after the agri-sciences company executed an offer for the acquisition of 100 percent stake in Isagro Asia.
Shares of Glenmark Pharma fell 3.67 percent to close at Rs 368.35 after global brokerage house CLSA maintained its sell call on the stock amid weak earnings and high debt concerns.
SRF shares gained 2.35 percent to settle at Rs 2,773.65 after IDFC Securities initiated coverage on the stock with an outperform call and target price at Rs 3,347 per share, implying 23.5 percent potential upside from current levels.
Shares of Bharat Petroleum Corporation jumped 6.42 percent to Rs 408.90 after a media report indicated that the government may be considering stake sale to a private player.
Gravita India rallied 5.75 percent to Rs 47.80 after it said that its lead recycling subsidiary in Ghana had doubled its production capacity.
European shares ground out gains for the fourth day running as signs of progress in US-China trade talks propped up shares after a mixed response to stimulus from the European Central Bank a day earlier, Reuters reported.
Amid Asian peers, Nikkei logged a gain of 1.05 percent and Hang Seng climbed 0.98 percent. Shanghai Stock Exchange was closed today for the mid-autumn festival.
Technical view on the market:
Nifty saw a flat opening and struggled in early hours of trade. However, the index bounced back with strong market breadth as there was wide participation from the mid and small caps.
The index formed bullish candle on daily as well as weekly charts, indicating strength in the market.
“The undertone continues to remain on the positive side. The index is in a recovery mode and there are more legs on the upside. Nifty is likely to test the 11,300-11,500 zone on the upside. Traders should look to position on the long side,” said Amit Shah, Technical Research Analyst with Indiabulls Ventures.Get access to India’s fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code “GETPRO”. Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.