Sensex and Nifty resumed their rally today after a session of pause as Reserve Bank of India in its MPC meet decided to keep the key lending rate or repo rate unchanged at 4%. This was in line with market expectations. Sensex and Nifty gained today, backed by index heavyweights HDFC twins, positive bullish global equities and healthy Q1 earning performance.
Reversing trend from yesterday's muted session, the 30-share BSE benchmark Sensex ended 362 points higher at 38,025 and broader NSE Nifty advanced 98 points to 11,200. Yesterday, Sensex ended 24 points lower at 37,663 and Nifty gained 6 points to 11,101.
ONGC, followed by Tech Mahindra, TCS, HCL Tech, NTPC, Infosys and HDFC duo were among the top gainers today, while Maruti, Axis Bank, Bharti Airtel, M&M and Reliance Industries were among the laggards.
Sectorally, except PSU Banks and Infra, all other indices closed in green territory, with IT, FMCG and metal as top performers.
Meanwhile, April-June quarterly earnings announcements by Vodafone, Adani Power, Lupin, HPCL, JK Tyre, Adani Enterprises among others will also helped the market uptrend today.
Commenting on today's RBI's MPC announcement, Nikhil Gupta, Economist - Institutional Equities, Motilal Oswal Financial Services said," RBI policy has been very balanced. While interest rates have been kept unchanged, the intention to support the borrowers and the lenders through this pandemic crisis is clear. The final impact would be determined by the recommendations of K V Kamath Committee, which will be very closely watched."
Dr. Joseph Thomas, Head of Research - Emkay Wealth Management on RBI's MPC announcement said," As expected, it is status quo on rate, and the emphasis is more on continuing with the accommodative stance, and liquidity enhancement measures, and the restructuring of the stressed loan portfolios. The outlook for growth and inflation continues to be uncertain, and contraction in GDP growth is expected and inflationary pressures are expected to remain elevated in Q2 and it may moderate in Q3."
Gurpreet Sidana, Chief Operating Officer, Religare Broking said," The additional measures announced to support the stressed sectors were also received well by the market. At the same time, no extension of the moratorium and steps to further strengthening the financial system relieved the banks and other financial institutions which in turn triggered a sharp uptick across the board,"
On the currency front, Indian Rupee ended almost unchanged compared to yesterday's close at 74.93 per dollar.
On Rupee's near term outlook, Sugandha Sachdeva VP-Metals, Energy & Currency Research, Religare Broking said," Despite the pause, rupee still remains in a sticky range of 74.50-75.50, and the domestic currency will be guided more by the movement in the dollar index, which is languishing at two- year lows and the pace at which the RBI will look to accumulate its forex reserves. Expectations of dollar inflows are capping upside for the pair (USD/INR), while the downside is being protected by the RBI."
Buoyancy in the global markets
Globally, markets in Asia and Europe were trading higher on Thursday. European markets rose as investors took cues from corporate earnings but gains were capped as economic data were weaker than expectation.
Asian markets were trading mostly higher, barring China, Hong Kong and Nikkei, as uncertainty continued over the tensions between the US and China.
Stock Exchanges in Wall Street closed higher for the fourth day consecutively as investors focused on corporate earnings and on hopes of fresh coronavirus relief package. Reports suggested that White House negotiators may reach a deal on a new coronavirus stimulus package by the end of the week.
In India, coronavirus cases neared 19.64 lakh with total deaths standing at 40,739. Worldwide, there are 189 lakh confirmed cases and 7.1 lakh deaths from the coronavirus COVID-19 outbreak.