Sensex jumps nearly 850 points; Nifty settles at 18,101: Top reasons for market rally

NEW DELHI: Equity indices jumped on Monday after declining for previous 3 sessions with the benchmark BSE sensex gaining nearly 850 points amid positive trends in global markets.
The 30-share BSE sensex zoomed 846.94 points or 1.41% to settle at 60,747.31. During the day, it jumped 989.04 points or 1.65% to 60,889.41.
The broader NSE Nifty climbed 241.75 points or 1.35% to end at 18,101.20.
From the sensex pack, Mahindra & Mahindra, HCL Technologies, IndusInd Bank, Tata Consultancy Services, Bharti Airtel, Tech Mahindra, Wipro, Infosys, Reliance Industries and Axis Bank were the major winners.
Both indexes posted their biggest intraday gains in nearly two months after logging a weekly loss of over 1% each in the first week of 2023.
Here are the top reasons for today’s market rally:
* IT, Auto stocks shine
TCS was 3.4% up ahead of its results, while Titan was the top loser on the Nifty 50, falling 2.1% after the jewellery maker reported quarterly sales growth below expectations.
Metals rose 1.43% on hopes of demand recovery after top metals consumer China reopened its borders.
Shares of Reliance Industries also witnessed strong buying today as the stock jumped 2.34%.
“These gains were also absorbed by the domestic market, with IT being the biggest gainer ahead of the release of sector earnings, as the favourable US economy boosted sector optimism,” Vinod Nair, Head of Research at Geojit Financial Services told news agency PTI.
* Q3 results season starts
IT sector stocks advanced 2.83%, making it the best-performing sector among the other 13 major Nifty sectoral indexes.
Tata Consultancy Services (TCS) is about to kick off the Q3 results season later today.
The quarterly earnings reports of top IT firms Infosys, HCL Tech and Wipro are due later this week.
* Positive global cues
The MSCI Asia Pacific Index climbed as much as 1.9% on Monday, taking its advance from an Oct. 24 low to more than 20%. Gauges in Hong Kong, Taiwan and South Korea led gains in the session, while Japan was closed for a holiday.
“Wall Street climbed in anticipation of a less aggressive US Fed as wage growth slowed and service activity contracted, fuelling bets that inflation is moderating. Furthermore, the December payrolls rising higher than anticipated increased the possibility of a softer landing for the US economy,” Nair told PTI.
* China stocks rise
Stocks in China have made a strong start to 2023 after being caught in a downward spiral for much of last year amid concerns over the economic toll from virus restrictions. Easing regulatory risks and more support measures to revive the troubled property sector have lent an additional boost to the market, helping the Asia rally.
A gauge of Chinese stocks listed in Hong Kong climbed 2% Monday, taking its gain for the year to nearly 9%. Alibaba Group Holding Ltd. led a rally in tech shares as comments by Guo Shuqing, party secretary of the People’s Bank of China, that a clampdown on the sector is coming to an end likely gave traders further conviction.
Goldman Sachs Group Inc. sees Chinese stocks extending their rally on policy pivots in areas including housing and internet regulation.
* Rupee gains
The rupee gained 29 paise to close at 82.37 (provisional) against the US dollar on Monday, supported by a weaker greenback overseas and a firm trend in domestic equities.
“In the last couple of days, the rupee has underperformed among its regional peers amid a headwind of wide current account deficit and foreign fund outflows. But now, looking at the recent high-frequency data and rebound in the risk assets, we could see the rupee start catching up with the other Asian currencies,” Dilip Parmar, Research Analyst, HDFC Securities told PTI.
(With inputs from agencies)

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