Stocks overcame their budget disappointments on Tuesday with the bellwether Sensex catapulting 917 points over Beijing going on the overdrive to contain the impact of the deadly coronavirus.
The 30-share Sensex opened higher at 40178.74 and built on its gains to hit a day’s high of 40818.94, a rise of around 947 points, before settling at 40789.38, up 2.30 per cent, or 917.07 points.
The Sensex leap was its biggest single-day rise since September 23, 2019. Similarly, the broader NSE Nifty ended at 11979.65, surging 2.32 per cent, or 271.75 points.
The sharp recovery in stock prices came after the People’s Bank of China said it would pump over $170 billion to maintain “reasonable and abundant liquidity” in the banking system, improving global sentiment with investors feeling the impact of the coronavirus on the global economy will not be as bad as feared. The recent fall in crude oil prices also helped.
In Asia, the Shanghai, Hong Kong, Tokyo and Seoul markets settled with firm gains. European stocks, too, opened on a positive note.
Back home, the markets have digested the disappointment over the budget and are now relying on other factors such as corporate earnings and macro-economic data. On Monday, a survey showed manufacturing activity hitting near eight-year highs on new orders. While the RBI is set to announce its monetary policy on Thursday, investors have already discounted a status quo on the repo rate.
“Today was a fabulous day for the equity markets as the Nifty moved up 271 points whereas Sensex surged 917 points. Except for Nifty Media, all other indices closed into positive territory on the back of encouraging data points related to the domestic economy,” Shrikant Chouhan, senior vice-president, equity technical research, Kotak Securities said.
“Other factors like a substantial fall in crude prices, a rise in the rupee and positive Asian markets also helped the market move higher. Towards the closing stages, Dow futures were trading into positive territory with a gain of almost 300 points,” Chouhan said.
On Tuesday, Titan was the biggest gainer in the Sensex pack, rallying 7.97 per cent, followed by ITC, HDFC, Bajaj Finance and Tata Steel. On the other hand, Bajaj Auto and HUL were on the losing side.
All sectoral indices ended with gains with BSE consumer durables, metal, oil and gas, energy realty and finance indices rallying up to 3.52 per cent.
With the Sensex rising 137 points on Monday, investor wealth has increased Rs 3.57 lakh crore in two days of market rally. The market capitalisation of the BSE-listed companies has risen Rs 3,57,044.43 crore to Rs 1,56,61,769.40 crore since Saturday.
Meanwhile, the rupee appreciated 11 paise to 71.27 per dollar.
