Sensex rallies for 4th day\, jumps 519 points on firm global cues\, easing border tensions

Mumbai: Firm world equities and de-escalation in India-China border tensions drove the BSE barometer Sensex higher for the fourth consecutive session on Tuesday with Larsen & Toubro and financials contributing the most to the gains.

Rising coronavirus cases, however, may continue to bother investors.

“The Indian indices traded positive, in sync with global indices, seemingly on the back of continued liquidity flows into the markets,” said Vinod Nair, Head of Research at Geojit Financial Services, pointing out that the gains were spread across sectors and market caps.

“Markets were also optimistic on the back of news of a de-escalation in border hostilities and the pace of Covid-19 recoveries increasing, in spite of the new virus infections. Investors are advised to remain cautious and keep booking profits,” he added.

Engineering major Larsen & Toubro contributed the most to Sensex’s 519–point rally as it rose 6.68 per cent after the company's transportation-infrastructure business won an EPC contract to construct packages 11 and 22 of the Delhi-Vadodara Expressway. Top private lender HDFC Bank advanced 1.20 per cent, while Bajaj Finance rose 6.54 per cent.

Peer index Nifty rose 156 points to close at 10,471.

The bulls continued to dominate as gainers beat losers in the ratio of 2.6:1 on the BSE, with the rally adding Rs 2.2 lakh crore to the market cap.

India VIX or volatility index dropped 3.51 per cent to 29.39, hinting that the choppiness may ease in the near term.

Broader market joined the party, with BSE midcap and smallcap indices rising 1.69 per cent and 1.80 per cent, respectively.

Among sectoral indices, only BSE Energy index shed value as it closed 1.05 per cent lower. BSE Power index continued to lead the gainers’ pack for the second day in a row as it rose 4.24 per cent. BSE Capital Goods index stood second with a 4.06 per cent gain. BSE Utilities rose 3.40 per cent.

Top valued firm Reliance Industries (RIL) dropped 1.55 per cent as traders locked in gains after the recent stellar run. The stock had logged a new high of Rs 1,804.10 on Monday.

IT stocks also joined the broad-based rally even as US President Donald Trump issued a proclamation to suspend issuing of H-1B visas, which is popular among Indian IT professionals, along with other foreign work visas for the rest of the year.

The country’s second-largest IT company Infosys rose 2.39 per cent while bigger rival Tata Consultancy Services (TCS) added 0.35 per cent.

Paint makers Asian Paints and Berger Paints advanced 1.83 per cent and 2.32 per cent, respectively ahead of their March quarter earnings announcements.

Info Edge (India) climbed 6.43 per cent after the board approved raising of funds via QIP for an aggregate amount not exceeding Rs 1,875 crore.

Markets at a glance

Who moved my market
World stocks and risk currencies rallied on Tuesday on encouraging global economic data and assurances from US President Donald Trump that the US-China trade deal remained “fully intact” after confusion over its fate had emerged, Reuters reported. Europe’s equity markets then extended the bounce, climbing between 1-2 per cent, while In Asia, Hong Kong’s Hang Seng ended up about 1.6 per cent after the early trade deal wobbles, South Korea’s KOSPI index added 0.2 per cent and Japan’s Nikkei climbed 0.5 per cent.

Amid heightened tensions between New Delhi and Beijing, the Indian and Chinese armies have arrived at a “mutual consensus” to "disengage" from all friction points in eastern Ladakh, PTI reported citing sources.

The number of coronavirus cases in India rose to 4,40,215 today with 14,933 fresh cases reported in 24 hours. The death toll went up to 14,011 as covid claimed 312 lives in 24 hours.

What to watch out for