BSE Sensex: Following a significant jump in US markets and buying in index major Infosys, equity benchmarks rebounded sharply in early trade on Thursday, with the Sensex rallying 651 points. The 30-share BSE benchmark was up 650.9 points to 56,319.93. The NSE Nifty increased by 185.65 points to 16,863.25.
Tech Mahindra, Tata Steel, Infosys, State Bank of India, Kotak Mahindra Bank, and M&M led the Sensex pack in early trade. Nestle and Titan, on the other hand, were laggards.
Hong Kong markets were quoting higher. In the overnight trade on Wednesday, stock exchanges in the United States surged higher.
Inflation hits markets
The Federal Reserve stepped up its fight against the worst inflation in 40 years on Wednesday. Raising its benchmark short-term interest rate by half a percentage point.
‘US equities rallied, recording the biggest one-day gain since 2020. After Federal Reserve comments suggested that the central bank is unlikely to consider a higher interest-rate hike of 75 basis points in the coming months. ”Moreover, rate hike and balance sheet unwinding quantum were on expected line without any negative surprise, which was already factored in market correction over past few days. It was like a relief rally to some extent,” said Mitul Shah, Head of Research at Reliance Securities. Meanwhile, domestic equity markets fell sharply on Wednesday. After the Reserve Bank of India unexpectedly raised the benchmark lending rate to 4.40 percent in order to contain inflation.
The BSE index fell 1,306.96 points, or 2.29 percent, to 55,669.03, while the Nifty fell 391.50 points, or 2.29 percent, to 16,677.60. Meanwhile, Brent crude, the international oil benchmark, rose 0.48 percent to USD 110.67 per barrel.
According to stock exchange data, foreign institutional investors sold shares worth Rs 3,288.18 crore on Wednesday. “US markets closed higher yesterday (Wednesday) after the Fed announced a 50 basis point interest rate hike. Jerome Powell stated that a 75 basis point increase is not something the committee is actively considering. This statement triggered a market rally,” said Mohit Nigam, Head of PMS at Hem Securities.