The BSE Sensex and NSE Nifty extended gains for a fourth consecutive session on Thursday after the US Fed raised interest rates.
The BSE Sensex and NSE Nifty extended gains for the fourth consecutive session on Thursday after the US Federal Reserve raised interest rates for the first time in nearly a decade and signalled its tightening cycle would be “gradual.” Sensex closed 309.40 points up at 25,803.78, while NSE Nifty settled 93.45 points up at 7,844.
After moving in a tight range till noon, markets suddenly gained pace and started moving higher, taking some encouragement with Fitch Ratings’ statement that India is better placed than many of its peers after the US Federal Reserve raised its key interest rates.
The rating agency said though, India is not immune to potential general emerging market jitters related to the Fed lift-off, but it is better placed than many of its peers for a number of reasons. Firstly India’s external balances have significantly improved since mid-2013; secondly, India is less dependent than several of its peers on commodity exports. Chief Economic Adviser Arvind Subramanian too said that the rate hike by the US Federal Reserve is in line with global expectations and its impact on India will be “very minimal” due to our strong macroeconomic conditions.
In the 50-share index, Tata Steel, Tata Power, Hindalco, Vedanta and Reliance Industries gained between 3.50 per cent and 5.25 per cent. On the other hand, Bosch, Idea Cellular, Cairn India, Axis Bank and ONGC slid between 0.55 per cent and 2.10 per cent.
Vinod Nair, head, fundamental research, Geojit BNP Paribas Financial Services, said, “The Fed’s 25 basis points rate hike was as per expectation. Markets have moved higher as the Fed outcome is seen as an end to the long prevailing uncertainty over rate hike. Moreover, the Fed has also signaled the future rate hikes to be in a gradual manner, which is certainly positive for EMs like India.”
All the sectoral indices on the BSE ended in green. The BSE Metal index gained the most — 2.46 per cent, followed by the BSE Power index (up 1.44 per cent), BSE Healthcare index (up 1.39 per cent) and BSE Auto index (up 1.33 per cent).
In a scrip specific development, IDBI Bank shares advanced over 6 per cent on a report that the government was planning to transfer the lender’s bad loans to a separate entity.
Aurobindo Pharma shares closed 1.51 per cent up at Rs 832.75 after the company said it has received final approval from the USFDA to manufacture and market Methylprednisolone Sodium Succinate Injection used in the treatment of various medical conditions viz allergic states , disorders etc.
The global markets mostly welcomed the Fed move and after US rally overnight the Asian markets followed, seeing the interest rates hike for the first time in almost a decade as an endorsement of better US economic growth, withstanding a higher cost of borrowing, even amid lackluster inflation. The European markets too made a strong start on Fed’s assurances that any further moves will be gradual. Also, UK retail sales rose more than forecast, up by 1.7 per cent from October.
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Markets through the day
3.30 pm: Sensex closed 309.40 points up at 25,803.78, while NSE Nifty settled 93.45 points up at 7,844.
3.21 pm: Sensex was up 328 points at 25,822. Nifty was up 99.60 points at 7,850.50. The BSE Midcap and BSE Smallcap index were up 1.55 per cent and 1.78 per cent, respectively.
2.48 pm: European shares surged in early trading on Thursday after investors saw the US Federal Reserve’s move to raise interest rates for the first time in nearly a decade as a sign of confidence in the world’s biggest economy. Sensex was up 270 points 25,765. Nifty was up 86.30 points at 7,837.20.
2:19 pm: Sensex was up 211.55 points at 25,705.92. Nifty was up 69.35 points at 7,820.25. Tata Power soared 4.11 per cent.
2.11 pm: Metal stocks were trading in green. SAIL surged the most 6.20 per cent, followed by NMDC (up 4 per cent), JSW Steel (up 3.51 per cent), Tata Steel (up 3.43 per cent) and Nalco (up 3.27 per cent). The BSE Metal index was up 2 per cent at 7214.99. Sensex was up 194.82 points at 25,689. Nifty was up 63.95 points at 7,814.85.
1.52 pm: The broader indices, however, were outperforming benchmarks, while the market breadth on the BSE was positive; there were 1,720 shares on the gaining side against 785 shares on the losing side while 217 shares remain unchanged. Sensex was up 117.96 points at 25,612. Nifty was up 28.70 points at 7,779.60.
1.30 pm: Sensex was up 29.80 points at 25,524.17. Select stocks from metal and mining counter edged higher as the government has approved allotment of coal blocks to public sector entities for commercial mining, taking the industry a step closer to complete deregulation and allowing private entry.
1.04 pm: Aurobindo Pharma shares were trading 1.52 per cent up at Rs 832.80 after the company said it has received final approval from the US Food & Drug Administration (USFDA) to manufacture and market Methylprednisolone Sodium Succinate Injection used in the treatment of various medical conditions viz allergic states , disorders etc. Sensex was trading 18.99 points down at 25,475.38. Nifty50 was 5.85 points at 7,745.05.
12.21 pm: Sensex was up 7.68 points at 25,502.05. Nifty50 was up 2.65 points at 7,753.55. Fitch Rating on Thursday said India is not immune to potential market jitters on account of interest rate hike by the US Fed, but favourable economic growth outlook makes it attractive for foreign investors. However, Chief Economic Adviser Arvind Subramanian said that the rate hike by the US Federal Reserve is in line with global expectations and its impact on India will be “very minimal” due to our strong macroeconomic conditions.
11.32 am: Sensex was trading 12.44 points down at 25,481.93. Nifty was trading 6.45 points down at 7,744.45. Shares of the steel companies were trading in positive terrain after Ministry of steel published draft order on its website prohibiting production, sales and trading without Bureau of Indian standards (BIS) approval. Tata Steel was trading 2.25 per cent up at Rs 250.40, while JSW Steel was trading 2.61 pe cent up at Rs 1035.00 and Steel Authority of India surged 1.44 per cent at Rs 45.80. Brokerage House Motilal Oswal said the government covers most carbon steel products and is likely to be more effective than earlier measures in containing imports for the next 6-9 months because most of the steel mills exporting to India don’t have BIS approval. Government had earlier slapped import duties on stainless steel to help local firms.
11.02 am: Oil and Natural Gas Corp (ONGC) shares were trading 2.27 per cent down at Rs 221.40 after ONGC Videsh Ltd on Wendesday got government nod to buy 15 per cent stake in Russia’s Vankor oilfield for $1.26 billion, the first oil deal since the Narendra Modi-led government came to power. Sensex was trading 13.24 points up at 25,507.61. Nifty50 was trading 8.35 points up at 7,759.25.
10.44 am: Bhushan Steel share price was trading 0.78 per cent up after the National Green Tribunal on Wednesday allowed Bhushan Steel and Strips Ltd’s Sahibabad plant in Uttar Pradesh, which had been ordered to be closed for polluting the environment, to operate for three weeks. Sensex was up 19.23 points at 25,513.60. Nifty was up 8.25 points at 7,759.
10.23 am: Sensex pared most of its initial gains and was trading 10.98 points up at 25,505. Nifty was up 6.30 points at 7,757.20
9.55 am: The rupee appreciated by 13 paise at 66.60 against the US dollar in early trade today on increased selling of the American currency by exporters even as the US Federal Reserve raised interest rates for the first time in nearly a decade. Nifty was up 16 points at 7,767.
9.45 am: Morgan Stanley upgraded SKS Microfinance to over-weight (OW) from equa-weight (EW) on high earning visibility. The share price of SKS Microfinance was trading 1.17 per cent up at Rs 472.50.
9.41 am: Nifty Bank slipped over 85 points from its day’s high. The index was trading 0.52 per cent up at 16,665.40. Nifty Bank opened at 16,704.05 and had touched a high and low of 16,751.85 and 16657.70, respectively, in trade so far. Nifty 50 index was up 0.29 per cent at 7,773.45.
9.35 am: The BSE Sensex slipped over 100 points from day’s high. Sensex was up 64.37 points at 25,558.74. The index had touched a high and low of 25,659.32 and 25,551.79, respectively, in trade so far.
9.30 am: On the US Fed rate hike, Nikhil Kamath, director, trading & risk, Zerodha said, “With the increase in rates, the Fed has finally aligned its intent and action. I think they have made it amply clear that further rate hikes would be ‘gradual’ and well spaced, which probably means to say we may get to see another marginal uptick in rates toward the end of 2016. The markets have already factored in yesterday’s hike, and I suppose the participants would be happy that the event is through. We may even witness a rally in the market. The focus in now back on domestic macro factors.”
9.26 am: Narayana Hrudayalaya has raised Rs 183.93 crore by allotting shares to anchor investors in a pre-initial public offering (IPO) placement. The three-day public offering opens from today and the minimum bid lot is fixed at 60 equity shares per bid. Axis Capital, IDFC Securities and Jefferies India are the book running lead managers for the issue. Read: Narayana Hrudayalaya IPO hits market today, should you invest?
9.18 am: NSE Nifty 50 index hits 7,800 for the first time since December 7. Sensex was up 103 points at 25,597.41. In the 50-share index, PNB, GAIL, SBIN, NTPC and Sun Pharma were up between 1.51 per cent and 1.80 per cent. On the other hand, Cairn India, Mahindra and Mahindra, HUL and HDFC slid between 0.20 per cent and 2.05 per cent.
9.15 am: Domestic equity markets opened in sync with the gains in the other global markets, after the US Federal Reserve raised interest rates for the first time in almost a decade and Fed Chair Janet Yellen emphasizing that further tightening would be slow. The BSE Sensex opened 102.26 points up at 25,596.63, while NSE Nifty50 index opened 32.15 points up at 7,783.05.
The US markets rallied in last session after Fed announced a 25 basis points interest rate hike on conclusion of its two days meeting, with major averages extending the upward move seen over the two previous sessions. The Fed said monetary policy remains accommodative even after the rate hike, which marked the first rate increase since 2006. The Asian markets have got an all green start, led by the Japanese market which is up by over 2 percent in early deals on yen weakness against dollar.
On Wall Street, the Dow ended Wednesday with gains of 1.28 per cent, while the S&P 500 rose 1.45 per cent and the Nasdaq 1.52 per cent.
Back home, domestic equity markets closed in green on Wednesday on account of buying in front line blue chip stocks. Sensex closed 173.93 points up at 25,494.37, while Nifty closed 50 points up at 7,750.90.
(With agency inputs)