Markets Rally On Positive Global Trends

Equity benchmark Sensex surged over 500 points in the opening trade on Tuesday, tracking gains in index majors HDFC twins, ICICI Bank and Reliance Industries amid mixed cues from global markets.

The 30-share BSE index was trading 509.07 points or 1.01 per cent higher at 50,950.14, and the broader NSE Nifty was quoting 149.35 points or 1 per cent up at 15,105.55.

HDFC Bank was the top gainer in the Sensex pack, rising around 2 per cent, followed by UltraTech Cement, Bajaj Finance, HDFC, M&M, Tech Mahindra and Asian Paints. ONGC and PowerGrid, on the other hand, were the laggards.

Sensex settled 35.75 points or 0.07 per cent higher at 50,441.07, and Nifty ended higher by 18.10 points or 0.12 per cent at 14,956.20, at the end of trade on Monday.

Foreign institutional investors were net sellers in the capital market as they offloaded shares worth Rs 1,494.49 crore on Monday, as per exchange data.

“Rising crude prices, surge in bond yields in the US and weakening rupee could be a near-term risk for domestic equities, which has already resulted in FPIs’ outflow in recent days,” says Binod Modi, who heads strategy at Reliance Securities. “However, we continue to believe that the recent rise in bond yields is discounting a faster recovery in economic growth and this is unlikely to move northward beyond a point.”

In the US, equities ended on a mixed note in overnight trade on Monday. “Clearly, the US markets are being driven by anticipations of faster economic recovery led by aggressive fiscal spending and faster reopening of the economy, which may also stoke inflation,” says Modi.

Bourses in Hong Kong and Tokyo were trading on a positive note in mid-session deals, while Shanghai and Seoul were in the red, duing the early trading hours in India.

The global oil benchmark Brent crude was trading 0.94 per cent higher at $68.88 per barrel.