Finance Minister Nirmala Sitharaman announced a number of measures on Friday to lift market sentiment and boost growth
But weak global backdrop could cap the upside for Indian equities in near term: Analysts
Indian stock market index had its best day in three months as a number of government measures to revive economic growth and hopes of progress in China-US trade talks helped boost sentiment. After volatile trading through most of the session, Sensex climbed 2.16% or 793 points to 37,494 while the broader Nifty settled 2.08% higher at 11,057.25. On Friday, Finance Minister Nirmala Sitharaman, outlined a raft of measures in an attempt to lift consumer sentiment and promised more actions soon to revive slowing economic growth.
1) Financial stocks led the gains today, with Nifty Bank index rising 3.6%. Among financials, HDFC surged 5% while Yes Bank soared 6%. Other top gainers in the pack included Bajaj Finance, ICICI Bank and HDFC Bank, all ending with over 4% gains.
2) The Nifty PSU bank index that tracks state-owned lenders rose over 3%. Indian Bank and Central Bank of India soared over 10% while SBI gained 3%.
3) The Nifty Auto index, which swung between losses and gains, settled 0.50% higher.
4) The Indian rupee which fell to 72.25 against the dollar pared losses and recovered to 71.96 in late trade.
5) Miners Vedanta Ltd and Tata Steel Ltd were among top losers in the Sensex pack, ending nearly 2% lower.
6) "Indian recovered sharply amid volatility and gained over 2%, tracking favourable local cues. It again regained strength as the day progressed, thanks to news that the US and China could restart the trade negotiation," said Ajit Mishra, vice president of research at Religare Broking.
But he remains cautious. "The recent volatility indicates excessive pessimism among the participants and we do not see this fading away anytime soon. Besides, we’ve scheduled derivatives expiry on Thursday (August 29) and that would further add to choppiness," he added.
7) "Nifty has immediate hurdle near 11,100-11,180 zone. Any decisive break above 11,180 can push index towards 11,350 zone in near term and support for index is coming near 11,000-10,930 zone," says Rohit Singre, senior technical analyst at LKP Securities.
8) Finance Minister Nirmala Sitharaman on Friday announced a rollback of tax surcharge on equity investments (both short term and long term gain) on foreign and domestic equity investors. She also announced upfront capital infusion of ₹70,000 crore into state-run banks.
9) US stock index futures futures reversed losses after President Donald Trump said that China wants to re-start trade talks, erasing a slump earlier.
10) Stocks had fallen sharply in Asia before Trump spoke as investors panicked that the latest tit-for-tat tariffs would damage global growth. On Friday, Trump announced an additional duty on some $550 billion of targeted Chinese goods, hours after China unveiled retaliatory tariffs on $75 billion worth of US goods. (With Agency Inputs)
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