Benchmark indices Sensex and Nifty ended on a bullish note on Wednesday, led by banking and automotive stocks amid positive global equities. Extending gains for the fourth straight session, the S&P BSE Sensex ended 230 points higher at 39,073. The Nifty 50 index ended 77 points higher at 11,549. Yesterday, while Sensex ended 44 points higher at 38,843, Nifty 50 index closed 5 points higher at 11,472.
Bajaj Auto, followed by Bajaj Finserv, IndusInd Bank, M&M, PowerGrid, Bajaj Finance, Axis Bank, Kotak Bank and ICICI Bank were among the top gainers today. On the other hand, Bharti Airtel, Asian Paints, HCL Tech, HDFC and TCS were among the laggards. On the sectoral front, except pharma and FMCG, all the other indices closed in bullish, with most gains registered in media, auto, banking and financials.
Auto stocks led the rally today after the country's finance minister FM Nirmala Sitharaman said the GST Council would consider the proposal to reduce tax on two-wheelers. Currently, the goods and services tax (GST) rate on motorcycles and scooters stands at 28%.
Vinod Nair, Head of Research at Geojit Financial Services said, "Auto stocks gained on expectations of government measures to help out the ailing sector. Markets expected to trade uncertain on lack of fresh triggers while stock-specific action will continue."
Traders said gains were capped in early trade amid rising coronavirus cases across the country. In India, the death toll touched 59,612 and total coronavirus cases reached 32.34 lakh as of Tuesday. Worldwide, there were 240 lakh confirmed cases and 8.23 lakh deaths from COVID-19 outbreak.
Tracking a bullish rally from the equity market, Indian rupee that opened 7 paise higher at 74.26, ended at 74.30 per dollar, as against yesterday's close of 74.32.
European markets, barring FTSE gained on Wednesday as market participants cheered signs of progress in US-Sino trade negotiations, however, remained cautious about the broader economic outlook.
Asian markets ended mostly taking cues from movements in US markets overnight. US markets closed higher on the progress in trade talks between the US and China and on the back of new home sales data that showed a 36% rise in sales of newly built homes in the US last month.
Top US and Chinese officials reportedly reaffirmed their commitment to a trade deal that had appeared on shaky ground because of worsening bilateral ties following weeks of escalating tensions between the world's two largest economies.
Vinod Nair said," Indian benchmark indices picked up positivity towards the latter half of the trading day, after trading flat with a slight positive bias, and ended in gains. It was in sync with a positive opening in the European markets which is banking on additional stimulus measures to aid economic recovery."
Commenting on Nifty's technical outlook, Rohit Singre, Senior Technical Analyst at LKP Securities said, "Nifty has shifted its support to 11500-11450 zone as index traded decisively above 11500 zone so existing longs can be held with 11500 trailing stop out and resistance is coming near 11600-11650 zone which will be immediate profit booking levels.
On Nifty Bank, he added, "Nifty bank closed a day at 23434 with gains of 1.48% and formed a bullish candle on the daily chart, supports are coming near 23230-23000 zone and resistance is coming near 23600-23850 zone."
Expressing views on Nifty's near term technical insights, Sameet Chavan (Chief Analyst-Technical and Derivatives, Angel Broking said, "Going ahead, a sustainable move below 11420 should be considered as an exit opportunity for existing longs and aggressive traders can opt to short as well. Below this, 11350-11300 are the next levels to watch out for. On the upside, 11500-11525 remains to be an immediate hurdle and in case if it extends further, we will still avoid participating in it."
On the Nifty Bank outlook, he added, "Banking space has gained some strength in the last 3-4 days and it is clearly not letting the market fall. It has now reached it's recent crucial high around 23200-23250."