Mumbai: Benchmark indices ended higher for the second consecutive day on Thursday with Sensex ending 1,000 points up and Nifty ending above 16,900 on back of positive cues from global market after US Fed policy outcome, good earnings in large cap space, partly short-covering and partly investment buying in some segments.
At the close, Sensex was up 1,041.47 points, or 1.87 per cent, at 56,857.79, and the Nifty 50 was up 287.80 points or 1.73 per cent at 16,929.60. A total of 1,904 shares have advanced, 1,427 shares declined, and 148 shares were unchanged. Bajaj Finance, Bajaj Finserve, Kotak Mahindra Bank, and IndusInd Bank were major gainers on the Nifty.
“Positive cues from global markets following the Fed policy outcome, as well as domestic large caps’ upbeat earnings, drove the market rally. The Fed’s decision was as expected, while their positive comment dismissing the possibility of a recession and hinting at a slower pace of rate hikes in the coming months boosted global sentiments,” said Vinod Nair, Head of Research at Geojit Financial Services.
Mid cap and small cap stocks ended on a strong note as Nifty mid cap and small rose 0.84 per cent and 0.85 per cent, respectively. Nifty IT and Financials outperformed on the National Stock Exchange.
Apart from this, Asian and European stocks also rose on Thursday on positive comments in Fed’s decision and hint of slower pace of rate hikes in the coming months. All Asian markets and Tokyo stocks closed higher.
On Wednesday, Federal Reserve officials raised interest rates by 75 basis points. Talking on the recession, Fed Chair Jerome Powell said: “I don’t think the US is currently in a recession and the reason is there are too many areas of the economy are performing well.”
“The market is taking cues from the Fed chief’s statement that ‘I don’t think we are in a recession now, the labour market continues to be tight’. Data – unemployment at 50-year lows and job vacancies at historical highs – supports the Fed chief’s view. In brief, the market is responding to the possibility of a soft landing for the US and the global economy,” said Dr. V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services.