Sensex rebounds over 138pts on hopes Fed will retain low rates
Mumbai: Snapping a two-day downtrend, the benchmark Sensex today rose over 138 points on the back of gains in IT, power and auto scrips amid positive global sentiments on hopes Fed would keep interest rates low for now.
The 30-share BSE barometer closed at 26,631.29 points, up by 138.78 points, or 0.52 per cent over last close after rising to 26,682.64 intra-day. In the previous two sessions, the index lost 568.53 points as foreign funds and retail investors pulled off cash off the table on fears the Fed will bring forward its timetable for hiking rates as the economy picks up speed.
The 50-share NSE Nifty also rose by 42.60 points, or 0.54 per cent to 7,975.50, ending two straights days of decline. Global markets in Asia and Europe also rose on speculation China will give its banks some fresh loans.
Bombay Stock Exchange
"Speculation that Fed would maintain its interest rates low and boost growth for now and that China's central bank will provide the country¿s big banks with fresh loans keep markets and commodities markets globally upbeat," said Rakesh Goyal, Senior Vice President, Bonanza Portfolio.
Stocks of IT companies that get more than 60 per cent of their revenue from the US led rebound on the bourses as buying intensified. Infosys rose 2.29 per cent, TCS gained 1.31 per and Wipro was up 1.41 per cent.
Dr Reddys surged 2.52 per cent, logging the best gains among 30 constituents of Sensex. Other gainers which supported the BSE index were Tata Power, Tata Motors, Tata Steel, BHEL, Bajaj Auto, Maruti Suzuki, M&M, Hero MotoCorp, ITC, L&T and RIL. On the other hand, 10 Sensex stocks ended down led by Cipla and Coal India.
With the improvement in the market's scenario, the mid cap and small cap indices also turned active with buying seen in several of its constituents. Midcap index was up 0.25 per cent and Smallcap rose 0.31 per cent.
Sectorwise, IT index outshined other sectors. The BSE IT sector index gained the most by rising 1.52 per cent, followed by Power sector index (up 1.35 per cent), Teck index (1.26 percent), Auto index (1.02 per cent), Capital Goods index (0.81 per cent) and Realty index (0.51 per cent).FMCG index (0.26 per cent), Healthcare index (0.28 per cent) and Oil & Gas index (0.21 per cent) and Metal index (0.27 per cent) also gained moderately.