Domestic benchmark equity indices opened at record highs as Asian stocks rose after longer-term Treasury yields and the dollar fell as traders kept their eyes on elevated U.S. inflation. In opening trades, Sensex jumped 331 points or 0.55% to 61,068. Likewise, the Nifty 50 was quoting at 18,285 higher by 123 points or 0.68%.
“Strong results from Infy, Wipro and Mindtree indicate that the market disappointing results from TCS was a one off. Even though high attrition is a challenge for the sector, strong deal wins and robust demand are clear positives. IT is likely to resume its leadership position since the prospects for the sector look bright for the next many years on the back of accelerating digitization by businesses globally. Strong performance of HDFC Bank indicates good Q2 results and the banking major joining the bull rally. Globally, inflation continues to be a worry and continuing disruption in global supply chains is an area of concern,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
The FOMC minutes indicate that Tapering is on course, possibly starting November and ending by mid-2022. Since this is a known event markets are likely to discount it before the actual announcement. Since there are no known triggers for a sharp correction in the short run and the market momentum continues to be strong, the exuberant retail investors are likely to drive the markets further up even though seasoned investors are worried about the excessive valuations, Vijayakumar added.
Among the sectoral indices on the NSE, Nifty IT index was the star of the day as it rallied over 3% as Infosys, Wipro and Mindtree posted better than expected Q2FY22 results. The Nifty Metal index surged 1.14%. Whereas Nifty Auto, Nifty Bank Nifty Realty, Nifty Pharma, Nifty FMCG indices gained anywhere between 0.20-0.80%.
The volatility gauge India VIX spiked by 1.08% to 16.27 levels.
Mirroring gains in benchmark indices the broader markets also hit new lifetime highs in early trade. The BSE MidCap index advanced 202 points or 0.76% to 26,759. It hit an all-time high of 26,829. Likewise the BSE SmallCap index touched a new peak of 30,003 and was trading at 29,934 gaining 179 points or 0.60%
Bulls overpowered bears in today’s session as 1,777 stocks advanced compared to 895 declined and 105 remained unchanged.
HCL Technologies, Indiabulls Real Estate, Benares Hotels, Century Textiles, Cyient, Den Networks, Ganesh Housing Corporation, GTPL Hathway, Inox Wind, Inox Wind Energy, Mahindra CIE Automotive, Radhe Developers, Superior Finlease, Vikas EcoTech, and Vikas Lifecare will release their September 2021 quarter earnings today.
Overseas, Asian stocks are mostly higher as investors reacted to the release of China’s inflation data for September. Markets in Hong Kong are closed on Thursday for a holiday. Producer inflation surged in September, official data showed Thursday.
The producer price index for September soared 10.7% as compared with a year ago. China’s consumer price index also rose 0.7% in September as compared with a year ago.
Singapore’s central bank unexpectedly tightened monetary policy on Thursday. Official advance estimates also showed Thursday that Singapore’s economy grew 6.5% year-on-year in the third quarter of 2021.
In US, the S&P 500 and Nasdaq ended higher on Wednesday, led by gains in shares of big growth names like Amazon.com and Microsoft, but JPMorgan shares fell along with other bank shares and weighed on the market.
Minutes released Wednesday afternoon from the Federal Open Market Committee’s September meeting showed the central bank could begin tapering its asset-purchase program as soon as mid-November.
Consumer prices rose 0.4% last month, slightly higher than August’s gain and pushing annual inflation back to the highest increase in 13 years. The consumer price index rose 5.4% in September from a year ago, the Labor Department said Wednesday, up slightly from August’s gain of 5.3%. Excluding the volatile food and energy categories, core inflation rose 0.2% in September and 4% compared with a year ago. Core prices hit a three-decade high of 4.5% in June.
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