Bulls attempted another comeback on Dalal Street amid the conducive global cues. Asian stocks rallied sharply during the early trade, whereas US Stocks settled higher during the overnight trade, thanks to a rebound in banking shares and eased down US inflation data.
Despite Moody’s downgrade on US banking sectors, traders believe that the worst is almost over after the collapse of SVB. Furthermore, the hopes of aggressive rate hikes by the US Fed waned as the consumer price index (CPI) dropped to 6 per cent in February 2023.
At 9.20 am, the 30-share pack BSE Sensex was trading 508.88 points, or 0.88 per cent, higher at 58,409.07, while NSE’s Nifty50 jumped 150 points, or 0.88 per cent, to 17,192.75. Broader markets rose in tandem with the headline peer as BSE midcap and smallcap index rose a per cent, each. Fear gauge India VIX plunged almost 7 per cent to 15.10-level.
Nifty settled below immediate support of 17200, indicating extended correction amid ongoing global uncertainties wherein strong support is placed at 16,800, said ICICIDirect in its morning report.
‘Going ahead, for a meaningful pullback to materialize, the index needs to decisively close above 200 days EMA placed around 17,600. Failure to do so would lead to the prolongation of corrective bias towards the key support zone of 16,800. In the process, the weekly stochastic oscillator has approached oversold territory ahead of US CPI data,” it added.
All the sectors of Nifty were trading with gains during the early few minutes of the session. Nifty Metal and Bank were leading the gainers, followed by IT, Realty, Auto and Financial Services counters.
Among the Adani Group stocks, Adani Enterprises and Adani Green Energy jumped more than 4 per cent, whereas Adani Ports and Adani Wilmar rose about 3 per cent, each. Ambuja Cements, NDTV and ACC were also trading in green. However, other cash stocks including Adani Power, Adani Total Gas and Adani Transmission were locked in lower circuits.
Only three stocks in the Nifty50 pack were trading lower at the initial trade. Bharti Airtel dropped more than 2 per cent, whereas SBI Life declined about a per cent. Sun Pharma was the last laggard on the benchmark index.
Among the gainers, Asian Paints rose over 2 per cent as the crude oil prices eased in the global markets. Titan rose 2 per cent as the gold prices held firm in the international markets. Maruti Suzuki, Hindalco, IndusInd Bank and Tata Steel also gained 2 per cent, each.
The US inflation print for February which came at 6 per cent year-on-year is indicative of disinflation but the decline is at a pace much lower than what the Fed would like. So, it would be realistic to expect a 25-bps hike in rate in the upcoming US FOMC meet, said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
“This will restrain equity markets from staging a rally. The US bank crisis will be on the back burner for now since the crisis news was overdone. For FIIs, the current negative sentiments in the market are favorable for sustained selling, which they have been doing for the last four sessions,” he said.
In the broader markets, PNC Infratech jumped over 5 per cent to Rs 299.90 as the company emerged as the lowest bidder for Varanasi-Ranchi-Kolkata Highway. Railtel Corporation of India also gained about 5 per cent after the company won a Rs 287.5 crore order from the Centre for Development of Advanced Computing (C-DAC) in New Delhi and Bengaluru.
Among other counters, Vakrangee rallied about 10 per cent, whereas Chennai Petroleum Corporation gained more than 6 per cent during the early trade. On the contrary, Panama Petrochem dropped about 6 per cent.
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