Sensex and Nifty opened higher on Wednesday, led by strong gains in Larsen & Toubro after a solid Q1 result. L&T surged over 4% following a 29.8 per cent profit jump. Bharti Airtel and NTPC also gained. However, FII selling and negative US-India trade developments remain key concerns for the market's short-term outlook.
Representational Image. File Pic
Benchmark equity indices Sensex and Nifty began the trade on an optimistic note on Wednesday amid heavy buying in infrastructure major Larsen & Toubro.
The 30-share BSE Sensex climbed 256.57 points to 81,594.52 in opening trade. The 50-share NSE Nifty went up by 69.3 points to 24,890.40.
From the Sensex firms, Larsen & Toubro jumped over 4 per cent after the infrastructure major reported a 29.8 per cent rise in consolidated net profit at Rs 3,617.19 crore during the June quarter, driven by strong overseas order growth.
Bharti Airtel, Asian Paints, NTPC and Bajaj Finserv were also among the gainers. However, Tata Motors, Hindustan Unilever, Eternal and Infosys were among the laggards.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 4,636.60 crore on Tuesday, according to exchange data. In Asian markets, Japan's Nikkei 225 index and Hong Kong's Hang Seng traded lower while South Korea's Kospi and Shanghai's SSE Composite index quoted in positive territory.
The US markets ended lower on Tuesday.
US President Donald Trump has said the trade deal with India is not finalised, as he stressed that India imposes more tariffs than almost any other country.
Trump spoke to reporters on Tuesday on Air Force One on his way back to Washington from Scotland and was asked about the trade deal with India.
"No, it's not," Trump said when asked if the deal with India is finalised.
He was also asked about reports that India is preparing to face higher US tariffs between 20-25 per cent, to which he replied, ¿I think so.¿
"The technical bounce back in Nifty by 140 points yesterday is unlikely to continue in the unfavourable near-term market scenario. Such bounce backs happen in an oversold market.
"The major drag on the market continues to be the negative news on the India-US trade front. President Trump's comment that "India may have to pay 20-25 per cent tariff" is very negative from the short-term market perspective," VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said
Sustained FII selling in the cash market for the seventh continuous trading day is another headwind for the market, Vijayakumar said adding that spike in Brent crude to $ 72 is another negative.
Global oil benchmark Brent crude dipped 0.01 per cent to USD 72.50 a barrel. On Tuesday, the Sensex jumped 446.93 points or 0.55 per cent to settle at 81,337.95. The Nifty climbed 140.20 points or 0.57 per cent to 24,821.10.
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