Indian benchmark equity indices rallied 420 points on Thursday, tracking gains in Infosys, even as global markets struggled under selling pressure amid rising coronavirus cases. After a highly volatile session, BSE Sensex ended 419.87 points, or 1.16 per cent, higher at 36,471.68. Similarly, the NSE Nifty surged 121.75 points, or 1.15 per cent, to 10,739.95. Infosys, M&M, Nestle India, IndusInd Bank, Kotak Bank, HCL Tech and Axis Bank were the top gainers. Tech Mahindra, ITC, NPTC, PowerGrid, Titan and ONGC finished with losses.
"Markets will continue to take cues from the global peers, in the absence of any major domestic trigger. While the mood in the global markets continues to remain buoyant, the rising number of cases in the US and India would remain a key cause of concern. Besides, the earnings announcements will further induce stock-specific volatility. Keeping all in mind, we reiterate our cautious stance on the markets and suggest preferring hedged trades," said Ajit Mishra, VP - Research, Religare Broking.
Here are 5 things to know before Friday's opening bell
Weak global cues
Bourses in Shanghai plunged 4.50 per cent as investors seemed disappointed with the pace of economic recovery. China's gross domestic product (GDP) expanded 3.2 per cent year-on-year in the second quarter of 2020, the country's National Bureau of Statistics said earlier in the day. Following negative cues from Chinese equities, benchmarks in Hong Kong, Tokyo and Seoul ended on a weak note. Stock exchanges in Europe were also trading in the red in early deals.
ECB leaves key interest rates unchanged
The ECB's governing council left its
key interest rates and crisis-fighting stimulus programmes unchanged Thursday as attention shifts to efforts by European governments to jumpstart the region's coronavirus hit economy.
Crude oil prices fall
Oil prices fell on Thursday after OPEC and other producers including Russia agreed to ease record supply curbs from August, though the drop was cushioned by tightening global inventories as economic activity picks up.
Foreign exchange reserves data
Data for deposit growth, bank loan growth and foreign exchange reserves is scheduled to be released on Friday. Though the data would be out after market hours, the investors are expected accordingly to plan a trading strategy for tomorrow.
According to traders, a rally in IT stocks led by Infosys kept investor sentiment positive, but concerns over recovery amid rising coronavirus cases induced volatility in the session. India reported the highest single-day spike of 32,695 coronavirus cases and 606 deaths in the last 24 hours. The total positive cases in the country stand at 9,68,876, including 3,31,146 active cases, 6,12,815 recoveries and 24,915 deaths, the Ministry of Health and Family Welfare data suggest.
What analysts say
"The market continues to remain cautious given flaring US-China trade relations, persistent rise in virus cases and implementation of fresh lockdowns. Though the initial success reports in Covid vaccines have brought in some cheer, the ongoing earnings season and management commentary is likely to
keep the markets volatile. We would advise traders to stay stock specific, while investors should be more defensive in their portfolio approach," said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services.
"The short term trend of Nifty is positive with range bound action. On the way up 10830-10900 is going to be a key overhead resistance for the market in the next few sessions. Important supports to be watched at 10600-10550 levels," said Nagaraj Shetti, Technical Research Analyst, HDFC Securities.
"Nifty has formed the hammer candlestick pattern which is a bullish sign, suggesting a northward journey in the index. At present level Nifty is having support at 10550 while resistance is seen at 10900-11000 levels," said Sumeet Bagadia, Executive Director, Choice Broking.