Sensex jumps 215 points at open, Nifty tops 15,750; metals, IT stocks rally

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Indian benchmark equity indices opened higher on Thursday tracking gains in metals and IT stocks amid a positive trend in Asian markets. In early deals, Sensex rose 215 points or 0.41% to 52,659, while the Nifty 50 advanced 59 points or 0.38% at 15,768.

“A major trend that has emerged post-Covid is the rise of the retail investor. Retail investors now account for 45 % of cash market transactions on Indian exchanges, a big jump from 33% five years ago. During this period the share of FIIs have fallen sharply from 23% to 11%. This domination of retail over FIIs is the reason why markets are not correcting sharply even when FIIs sell continuously. (FIIs have sold Rs 6100 cr worth shares this week). But it is a fact that most retail investors are driven by sentiments & momentum, not fundamentals,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

Meanwhile, in another boost to the bulls, the Fed has kept the rates unchanged and reiterated that ” we are nowhere near considering a rate hike.” Also, the bounce back in Hang Seng & Shanghai indexes suggests that the Chinese tech sell-off is a temporary issue & unlikely to become a contagion impacting global markets, added Vijayakumar.

Gainers & losers

Sectoral strand

All sectoral indices opened higher. Nifty Metal and Nifty IT indices rose 0.75% each. Nifty Pharma rallied 0.69% and Nifty Realty gained 0.63%. Whereas Nifty Bank, Nifty Auto and Nifty FMCG indices were up to 0.50%.

Broader markets

The broader market mirrored the gains in the benchmark indices. BSE MidCap index opened with gains of 0.41% at 22,973 levels, whereas the BSE SmallCap index rose 0.61% to 26,525.

Market breadth was positive as 1,742 stocks advanced compared to 511 declined while 66 remained unchanged on the BSE.

Earnings today

Tech Mahindra, Colgate-Palmolive (India), AAVAS Financiers, ADF Foods, Aegis Logistics, Ajanta Pharma, CCL Products, Container Corporation of India, Dhanuka Agritech, Dwarikesh Sugar Industries, Eris Lifesciences, Future Retail, GHCL, Home First Finance Company India, Indus Towers, JK Lakshmi Cement, Jindal Stainless (Hisar), Jyothy Labs, Laurus Labs, LIC Housing Finance, Mahindra Holidays & Resorts India, Motilal Oswal Financial Services, Oberoi Realty, Parag Milk Foods, Punjab & Sind Bank, PVR, Raymond, Shoppers Stop, Shriram City Union Finance, TVS Motor Company, Union Bank of India, Vaibhav Global, and Welspun Corp will release their quarterly earnings today.

Primary market

Specialty chemical company Tatva Chintan Pharma Chem is expected to double investors’ money on listing over the issue price. The company is slated to make its debut today on the exchanges. Its Rs 500-crore issue was subscribed 180.36 times during July 16-20, the second-highest subscription seen among IPOs in 2021.

Global markets

Overseas, Asian stocks are trading higher on Thursday after the U.S. Federal Reserve left its benchmark interest rate near zero. Meanwhile, shares in Hong Kong continued to see a rebound from a two-day slump earlier in the week.

U.S. stocks slipped on Wednesday in listless trade after the Federal Reserve gave no clue about when it might start reducing its purchases of government bonds, even as it said the economic recovery is on track.

The Federal Open Committee ended its two-day meeting by keeping interest rates in a target range between zero and 0.25%. Fed Chairman Jerome Powell said the U.S. central bank is nowhere near considering a rate hike despite the optimism over the U.S. economy.