Sensex rises for 5th day, gains 187 points; Infy, financials surge

Mumbai: Extending its gains to the fifth straight session on Tuesday, BSE barometer Sensex rose 187 points, led by gains in software major Infosys and financial stocks, disregarding weak global cues and surging coronavirus cases. Easing tensions between India and China did help investor sentiment.

Both benchmark indices Sensex and Nifty settled at closing levels last seen on March 6.

“Benchmark indices were volatile in trading today, after swinging from losses to end the day flat, with a positive bias. This was in spite of negative global cues, due to renewed uncertainty regarding economic recovery and delay in complete opening up of economies from lockdowns,” said Vinod Nair, Head of Research at Geojit Financial Services.

“These uncertainties regarding the sustainability of the market rally was visible in the Indian markets also but were offset by gains in IT and financials Index. Any impact seen on momentum, which has been driving the market along with liquidity, can lead to nervousness in the markets and investors are advised to watch out for the same,” added Nair.

The 30-pack Sensex, after briefly slipping into the red zone during the day, rose 187 points to end at 36,675 while peer Nifty climbed 36 points to shut shop at 10,800.

A total of 17 Sensex stocks closed higher. Infosys contributed more than half to Sensex’s total gains as it rose 4.01 per cent. Consumer goods financier Bajaj Finance rose 7.84 per cent after the recent business updates suggested things are not as bad for the non-banking finance companies (NBFC) as previously thought.

Private lenders ICICI Bank and Axis Bank rose 3.84 per cent and 3.09 per cent, respectively, while HDFC climbed 0.96 per cent.

NSE’s India Vix fell for the fifth day in a row. It dropped 0.07 per cent to 25.18.

Despite the gains, the market breadth was neutral, as gainers and losers were almost equal on the BSE.

Broader markets were in sync with benchmark, with BSE midcap and smallcap indices rising 0.58 per cent and 0.57 per cent, respectively.

BSE IT index was the top sectoral gainer as it advanced 2.10 per cent. BSE Finance followed next with a 1.73 per cent gain.

Oil & Gas index turned out to the worst loser for the day as it shed 2.42 per cent.

Suzlon Energy hit 5 per cent lower circuit limit after it posted a net loss of Rs 824 crore for the quarter ended March 31. It had posted a net loss of Rs 293 crore in the corresponding quarter last year.

Oil-to-telecom conglomerate Reliance Industries (RIL) shed 1.48 per cent on profit booking after the stock logged a new high in the previous session.

Bandhan Bank jumped 10.65 per cent after the lender reported healthy loan and deposit growth in the April-June quarter on a yearly basis despite nationwide Covid-19-induced lockdown.

Markets at a glance:

• Sensex, Nifty rise for 5th day in a row;
• Both benchmarks log highest close since Mar 6
• Sensex rises 0.51% or 187 points to close at 36,675
• Nifty up 0.33% or 36 points to close at 10,800
• India VIX drops for 5th day in a row, down 0.07% to 25.18
• 17 of 30 Sensex stocks close higher
• Top Sensex gainers: Bajaj Fi up 7.84%, IndusInd 6.10%, Bajaj Finserv 4.98%
• Top Sensex losers: NTPC down 2.78%, ITC 2.73%, Power Grid 2.58%
• Market breadth neutral, advance-decline ratio at 1:1
• BSE midcap index up 0.58%, smallcap 0.57%
• BSE IT top sectoral gainer, up 2.10%; Aptech up 14.34%, NIIT 5.21%
• BSE Finance up 1.73%; Ujjivan SFB up 19.94%, Maharashtra Scooters 17.72%
• BSE Oil & Gas top loser, down 2.42%; IGL down 5.90%, Petronet LNG 4.83%
• RIL drops 1.48% on profit booking after hitting new high in previous session
• Bandhan Bank jumps 10.65% on healthy loan, deposit growth in Q1
• Suzlon drops 5% as Q4 net loss widens

Who moved my market:

• Relief on de-escalation of India-China tensions

The breakthrough in India’s attempts to get Beijing to pull back its troops in Galwan Valley came on Monday after two hours of tense negotiations between national security advisor A K Doval and China's state councillor and foreign minister Wang Yi. Separately, a day after de-escalation of border tensions between India and China, a White House official said the US military will stand with India in conflict with China.

• Mixed world equities

The Chinese share market extended its positive run on Tuesday, in line with the mainland government’s push for a stronger market, while the rest of the Asian region turned cautious on equities, Reuters reported. European shares fell as surging US coronavirus cases and forecasts for a deeper-than-feared recession in the euro zone dimmed optimism around a post-pandemic rebound, a Reuters report said. MSCI’s broadest index of Asia-Pacific shares outside Japan see-sawed during the local session and was down 0.2 per cent, after it briefly traded in positive territory, while the pan-European STOXX 600 index slipped 1 per cent.

• Rapid rise in coronavirus cases

Total new coronavirus infections in India rose past the 7-lakh mark today and the death toll crossed 20,000 following a spike in cases and deaths in the past 24 hours. This takes the total tally of coronavirus cases to 7,19,665, with 22,252 new cases reported over last one day. The death toll has climbed to 20,160 with 467 new fatalities.

What to watch out for:

• The continuously rising new coronavirus cases are a major cause of worry.

• The movement of global markets will be closely watched as the domestic market tends to follow suit.

• Progress on a domestic as well as overseas vaccine for Covid-19 treatment will be closely watched.

• The June quarter corporate earnings, which start coming in later this week, will provide a better picture of the damage caused by the pandemic-induced lockdown.

• The data of Index of Industrial Production (IIP), which is scheduled to be released on July 10 will be on focus.