Nifty above 16,800 mark; breadth remains strong

The benchmark indices pared early morning gains but continued to trade higher during afternoon trade. Barring Nifty Realty, all the sectoral indices on the NSE traded in green. The Nifty hovered at 16,800 mark.

Positive global cues boosted sentiment after the US Federal Reserve`s latest policy decision was on expected lines, averting concerns of larger-than-expected hikes.

At 13:28 IST, the barometer index, S&P BSE Sensex rose 535.87 points or 0.96% to 56,841.68. The Nifty 50 index was up 153.70 points or 0.92% to 16,831.30.

In broader market, the S&P BSE Mid-Cap index rose 0.58% while the S&P BSE Small-Cap index added 0.68%.

The market breadth was strong. On the BSE, 2,041 shares rose while 1,210 shares fell. A total of 125 shares were unchanged.

Gainers & Losers:

Hero Motocorp (up 3.7%), Tata Steel (up 3.62%), Infosys (up 3.22%), Tech Mahindra (up 3.05%) and Oil & Natural Gas Corporation (ONGC) (up 2.37%) were major Nifty gainers.

Tata Consumers Products (down 2.66%), Indusind Bank (down 2.11%), Nestle India (down 2.08%), Britannia Industries (down2.06%) and Apollo Hospitals Enterprise (down 1.78%) were majority Nifty losers.

Economy:

The seasonally adjusted S&P Global India Services PMI Business Activity Index rose to 57.9 in April, up from 53.6 in March. The expansion was the fastest since last November. The output was boosted by higher bookings, the easing of pandemic-related restrictions and favourable demand conditions.

Pollyanna De Lima, Economics Associate Director at S&P Global, said: "The Indian service economy followed manufacturing in gaining growth momentum at the start of fiscal year 2022/23."

"In isolation, the PMI data for the service sector were mostly encouraging, as surging demand underpinned quicker increases in new business inflows and output. Employment rose for the first time in five months, but business sentiment was restrained by inflation concerns."

"On this front, the latest results showed a resurgence in price pressures during April. Service providers reported having paid more for food, fuel and materials, with some mentions of higher wage costs also pushing up overall expenses. The overall rate of inflation quickened to the second-highest in the survey history, leading companies to hike their selling prices to the greatest extent in close to five years."

"Consumer Services and Finance & Insurance were the top-performing areas of the service economy, while Real Estate & Business Services was the only sub-sector to post contractions in sales and output."

Stocks in Spotlight:

Equitas Small Finance Bank rose 3.27% to Rs 53.75 after the bank`s net profit rose 5.88% to Rs 119.51 crore on 4.74% increase in total income to Rs 1,043.98 crore in Q4 March 2022 over Q4 March 2021. Profit before tax (PBT) rose rose 5.15% year-on-year to Rs 160.73 crore in Q4 March 2022. Net Interest Income for Q4 FY22 stood at Rs 552 crore as against Rs 449 crore in Q4 FY21. NIM stood at 9.12% in Q4 FY22.

ABB India surged 10.37% to Rs 2,222.60 after the company`s net profit jumped 76.45% to Rs 152.08 crore on 20.75% increase in net sales to Rs 1,953.93 crore in Q1 March 2022 over Q1 March 2021. During the quarter, the company sold the turbocharger business to its wholly owned subsidiary Turbocharging Industries and Services India. In this regard, profit on sale amounting to Rs 293 crore has been disclosed as exceptional item in the financial results for the first quarter ended 31 March 2022.

Laxmi Organic Industries tumbled 5.94% to Rs 399.10. The chemical manufacturer`s consolidated net profit surged 58% from Rs 57.40 crore for the quarter ended March 2022 as compared with Rs 36.34 crore during the quarter ended March 2021. Consolidated net sales surged 69.4% to Rs 879.86 crore in Q4 FY22 from Rs 519.52 crore posted in Q4 FY21. Profit before tax rose by 15.9% to Rs 56.47 crore in Q4 FY22 over Rs 48.73 crore in Q4 FY21.

Global Markets:

European markets rallied across the board on Thursday, tracking global sentiment after the U.S. Federal Reserve doused speculation about more aggressive monetary tightening.

The Russian forces have reportedly renewed their assault on the Azovstal steelworks complex, a last stronghold for Ukrainian fighters in the southern port city of Mariupol. Meanwhile, the EU has proposed a gradual ban on Russian oil in its sixth round of sanctions against Moscow since the unprovoked invasion of Ukraine.

Asian stocks traded mixed on Thursday, tracking overnight rally in the US market after the U.S. central bank on Wednesday raised interest rates by 50 basis points but sounded a less hawkish tone than some had feared. Markets in Japan and South Korea are closed on Thursday.

China`s services sector activity shrunk further in April, a private sector survey showed Thursday. The Caixin services Purchasing Managers` Index (PMI) declined to 36.2 for April, lower than March`s reading of 42.

The US Fed delivered the first 50 bps interest rate hike since 2000. Investors were worried that Fed might shock markets with a 75 bps hike.

Fed Chairman Jerome Powell said half-point rises remain on the table for the next couple of meetings. Powell talked about a strong economy, but also the pain consumers have been feeling at the grocery store and gas pump, in afternoon news conference, saying higher interest rates are the cure.

The Fed also outlined plans to reduce its near $9 trillion balance sheet, first by $47.5 billion a month starting in June, but ramping up to $95 billion a month. This will result in a nearly $3 trillion reduction in its record size over the next three years.

Meanwhile, US private payrolls climbed by 247,000 in April, according to the ADP National Employment Report released Wednesday.

The U.S. trade deficit jumped 22.3% to record $109.8 billion in March, the U.S. Census Bureau and the U.S. Bureau of Economic Analysis said Wednesday. U.S. imports climbed 10.3% to $351.5 billion, while U.S. exports increased 5.6% to $241.7 billion in March.

In addition, the Institute for Supply Management services index showed weaker new-orders growth and employment, with the number dropping to 57.1% in April from 58.3%.

Powered by Capital Market - Live News