Late recovery lifts Sensex by 164 pts; FMCG, IT shine
Mumbai : Market benchmark Sensex rebounded by 164 points today to close at 25,653.23 as investors ignored a spurt in wholesale inflation as well as forecast of a monsoon delay and rather went for value-buying in FMCG and IT stocks.
Earlier in the session, banking stocks pulled down the index by 137 points as Bank of Baroda plunged 8.23 per cent on poor show in fourth quarter, highlighting concerns over the slow progress in solving NPA issue at the public sector banks.
Other banking stocks that saw selling pressure include SBI, ICICI Bank and Axis Bank, falling by up to 4.22 per cent.
“A strong recovery in the last hour of trading erased earlier losses, when stocks were largely southbound… after five PSU banks reported net loss in their Q4 results on Friday,” said Anand James, Chief Market Strategist at Geojit BNP Paribas Financial Services.
Crude oil prices globally jumped on reports the market had moved into a supply deficit earlier than expected.
The broader markets too showed strength with the BSE mid- cap rising 0.30 per cent and small-cap gaining 0.09 per cent.
The 30-share Sensex after shuttling between 25,351.62 and 25,688.46 settled 163.66 points or 0.64 per cent up at 25,653.23. The gauge had lost 301 points on Friday due to downbeat economic data amid fears that Sebi’s plan to tighten P-Note norms would hit foreign fund inflows.
The NSE Nifty ended 45.85 points or 0.59 per cent higher at 7,860.75 after moving in a range of 7,772.15 to 7,873.90.
Meanwhile, expensive food items, like pulses, potato and sugar pushed the WPI-based inflation into positive zone for the first time in 18 months at 0.34 per cent in April, hitting the chances of Reserve Bank cutting interest rates soon.
Investor sentiment also remained cautious after Met Department yesterday predicted a six-day delay in the onset of monsoon, which was scheduled to hit Kerala on June 1.
Still, FMCG stocks zoomed, with ITC logging gains of more than 3 per cent at Rs 329.30. It stocks such as Infosys, TCS and Wipro also recorded gains on value-buying.
Globally, Asian markets rallied following reports that Japan may postpone a sales tax rise to avoid damaging an already fragile economy. Indices in China, Hong Kong, Japan, Singapore, South Korea and Taiwan closed by higher by 0.04 per cent to 0.84 per cent.
Europe was lower with indices in France and the UK down between 0.23 per cent and 0.79 per cent.