The domestic equity market ended the truncated week on a positive note and extended its winning streak to the straight fifth session. After a weak opening, headline peers took a U-turn and returned to positive territory as the Reserve Bank of India (RBI) did not increase interest rates.
According to the market participants, the pause by the central bank is a prudent approach and a withdrawal of the accommodative stance bodes well for the majority of the sectors. In the coming week, India Inc will begin to announce its Q4 earnings, which will guide the markets.
For the day, BSE’s barometer Sensex added 143.66 points, or 0.24 per cent, to settle at 59,832.97, while NSE’s Nifty50 added 42 points, or 0.24 per cent, to settle just a point below 17,600. Broader markets outperformed the headline peers as BSE midcap and smallcap indices added a per cent, each. India VIX dropped about 5 per cent to 11.80-level.
Markets settled marginally higher in a volatile session, in continuation of the prevailing trend. After the initial downtick, Nifty surged strongly after the MPC’s unchanged stance on key rates, however profit taking above 17,600 zone capped the upside, said Ajit Mishra, VP – Technical Research, Religare Broking.
“The stability on the global front has eased some pressure and now the focus would shift to earnings for cues. We expect some consolidation in Nifty citing multiple hurdles around the 17,600-17,700 zone. However, the rotational buying across index majors would help in maintaining the positive tone,” he said.
On a sectoral front, only Nifty IT, FMCG and Consumer Durable indices disappointed. Among the gainers, the Nifty Realty index surged about 3 per cent, followed by a one per cent rise in Nifty Pharma and Nifty Healthcare indices. Nifty Oil & Gas, Media and Metal indices also posted decent gains.
In the Nifty50 pack, Bajaj Finance extended its gains by another 3 per cent after strong quarterly updates. Adani Enterprises surged over 3 per cent amid the Sensex entry buzz. Tata Motors and Bajaj Finserv advanced 2 per cent, while IndusInd Bank and Mahindra & Mahindra were other top gainers.
On the downside, HCL Technologies dropped 2 per cent. ONGC, ICICI Bank and AXIS Bank shed more than a per cent each. Titan, Tech Mahindra, UPL, Hindustan Unilever and Tata Consultancy Services were among the other top laggards on the index.
The surprising policy move to pause interest rate hikes has had a convincing effect on bond yields and the stock market. A plausible peaking of the interest rate will have a positive effect on the financial markets, which was reflected in today’s drop in yield and marginal upside of the domestic stock market when the Asian market was negative, said Vinod Nair, Head of Research at Geojit Financial Services.
“However, the trend to continue during the year will depend on a consistent fall in inflation, which is forecasted to stay elevated above the FY24 target. Given the high gap between current and target inflation, the RBI will have to hold the rates high for a long period, limiting the upside,” he said.
A total of 3,636 shares were traded on BSE on Thursday, of which 2,387 settled with gains. 1,138 stocks ended the session lower, while 111 shares remained unchanged. A total of 434 shares hit their upper circuit, whereas 95 tested the lower circuit levels for the day.
In the broader markets, Rama Phosphates surged about 20 per cent, while Dhani Services jumped over 17 per cent. Vakrangee gained over 14 per cent. Indian Energy Exchange gained over 10 per cent, while Cholamandalam Investment and Finance Company gained about 8 per cent after healthy operational updates in the period that ended March 31, 2023.
On the contrary, Black Rose Industries and SML Isuzu dropped 7 per cent, each, thanks to profit booking. Avenue Supermarts tanked more than 4 per cent as the quarterly updates of the company disappointed investors. Dabur India was also down 4 per cent even as CRISIL India reaffirmed its credit ratings.
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