Sensex rises 400 points, Nifty tops 19,450 on firm Asian cues

Following the rise in Asian markets on hopes of a China stimulus package and Wall Street gains, benchmark equity indices opened higher on Tuesday, led by heavyweight Reliance Industries, banking and financial stocks.

The S&P BSE Sensex was trading 401 points or 0.61% higher at 65,745. Nifty50 was trading at 19,474, up 118 points or 0.61% at around 9.48 am.

From the Sensex pack, Bajaj Finance, Tata Motors, Bajaj Finserv, UltraTech Cement, and Asian Paints opened with gains, while Wipro, Tata Steel, TCS, HUL, ICICI Bank, and Infosys opened with cuts.

Shares of Vedanta dropped 3% after Taiwan’s Foxconn withdrew from a $19.5 billion semiconductor joint venture with the company. Shares of APL Apollo Tubes opened 4% higher after the company’s unit was granted incentives worth Rs 500 crore by the Chhattisgarh state government.

Sector-wise, Nifty Auto surged 0.76% and Nifty Financial Services rose 0.56%. Banks, FMCG, pharma, realty, consumer durables, and healthcare sectors also opened with gains. In the broader market, Nifty Midcap 100 rose 0.43%, and Nifty Smallcap 100 gained 0.39%.

Experts View

“The ongoing rally in the market is slowly moving from broad-based rally to specific stock-driven rally. There are no major triggers that can take the rally much higher from the present levels. Global cues also are uncertain,” V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said.

“Markets will be closely watching the CPI and PPI data from the US due on 12th and 13th July. This data will give an indication of the rate decision by the Fed on July 26th,” Vijayakumar added.

Deepak Jasani, Head of Retail Research at HDFC Securities, said, “Nifty seems to be stuck in the trading range of 19300-19500. Breakout from this range on either side would decide the near term direction for the market.”

Global Markets

Asian shares bounced on Tuesday as investors hoped this week’s US inflation data supports an imminent end to rate hikes and cheered the prospect China will deliver economic stimulus to prop up stalling growth.

Japan’s Nikkei stock index rose 0.66%. China’s blue-chip CSI300 index was 0.4% higher in early trade, while Hong Kong’s Hang Seng index opened up 1.03%.

On Monday, US stocks ended higher following last week’s losses while Fed officials’ comments bolstered the view that the US central bank may be near the end of its tightening cycle. On Wall Street, the Dow Jones Industrial Average rose 0.62%, the S&P 500 gained 0.24% and the Nasdaq Composite added 0.18%.

FII/DII Tracker

Foreign institutional investors bought Rs 588 crore of Indian equities on a net basis on Monday, while domestic investors purchased Rs 288 crore of shares, as per provisional NSE data.

Crude Oil

Oil prices edged higher on Tuesday, recouping some of the losses from the previous session, as traders focused on supply cuts by the world’s biggest oil exporters Saudi Arabia and Russia and a weaker dollar.

Brent crude futures rose 43 cents, or 0.55%, to $78.12 a barrel, and US West Texas Intermediate crude was up 47 cents, or 0.64%, at $73.46.

Currency Watch

The Indian rupee rose 18 paise to $82.41 against the US dollar in early trade, tracking the dollar’s decline versus a basket of its major peers to the lowest level in two months.