Sensex, Nifty rally on US job data, buying in IT stocks 

NEW DELHI:  Domestic equity markets snapped the three-day losing streak on Monday on the back of upbeat US economic data that hinted at a less aggressive rate hike by the US Federal Reserve in future to control inflation. 

After a dismal week in which the benchmarks shed up to 2%, the BSE Sensex and NSE Nifty gained about 1.4% each on Monday. The 30-share pack Sensex rallied 850 points to regain the 60,000 level and closed at 60,750. The broader Nifty50 reclaimed the 18,000 mark to end at 18,101, a gain of 240 points from Friday’s closing. 

The surprise recovery of IT majors, ahead of the Tata Consultancy Services (TCS) quarterly earnings, contributed significantly to the rebound. TCS reported a 10.98% increase in its consolidated net profit at `10,883 crore for the quarter ended December 2022 (Q3FY23). The market also got a boost from China re-opening its borders amid covid-19 crises.

Auto major Mahindra & Mahindra, SBI Life, IndusInd Bank, IT majors -- TCS and HCL Tech -- surged more than 3%, leading the rally in Nifty50. Tata Group company  Titan shed maximum at nearly 2%. Except for consumer durables, all Nifty sectoral indices closed the Monday session in the green with IT, energy, auto, metal and PSU bank indices jumping the most.

Vinod Nair, head of research at Geojit Financial Services, said the Wall Street climbed in anticipation of a less aggressive US Federal Reserves as wage growth slowed and service activity contracted, fuelling bets that inflation is moderating. 

“Furthermore, the December payrolls rising higher than anticipated increased the possibility of a softer landing for the US economy. These gains were also absorbed by the domestic market, with IT being the biggest gainer ahead of the release of sector earnings, as the favourable US economy boosted sector optimism,” added Nair.