New Delhi | Jagran Business Desk: Ahead of Reserve Bank of India’s scheduled monetary policy decision on Wednesday, Indian shares surged as sensex rallied 676.88 points to 58,310.53 in the opening session, while Nifty surged 197.75 points to 17,374.45.
The blue-chip Nifty 50 and the Sensex both have fallen about 4 per cent since the central bank’s last meeting in October, weighed down by fears over high valuation and as investors waited for more clarity on just how much economic disruption the new variant might cause.
The Reserve Bank of India will likely hold its benchmark interest rate at 4.00 per cent and the reverse repo rate at 3.35 per cent after a three-day meeting ending on Wednesday, a Reuters poll of 50 economists showed.
The economists expect the central bank to raise its reverse repo rate early next year and increase the repo rate the following quarter, but were split on whether the Omicron variant risked delaying those moves.
“While on-track recovery and above-target inflation make a case for policy normalisation, authorities are likely to be watchful of the new risk on the horizon – the Omicron variant,” Radhika Rao, a senior economist with DBS Bank, said in a preview note.
“The pandemic situation is the key wild card, with any signs of a worsening outbreak to push policymakers to err on the side of caution and slip into an extended status quo.”
Updates from Tuesday:
Recovering from a two-session carnage, equity benchmark Sensex rebounded 887 points on Tuesday, led by gains in index majors ICICI Bank, HDFC twins and Infosys amid a positive trend in global markets.
The 30-share BSE Sensex ended 886.51 points or 1.56 per cent higher at 57,633.65. Similarly, the broader NSE Nifty rallied 264.45 points or 1.56 per cent to 17,176.70.
Tata Steel was the top gainer in the Sensex pack, advancing nearly 4 per cent, followed by Axis Bank, ICICI Bank, Kotak Bank, SBI and Bajaj Finance. On the other hand, Asian Paints was the sole laggard.
Elsewhere in Asia, bourses in Shanghai, Hong Kong, Seoul and Tokyo ended with gains. Stock exchanges in Europe were also trading on a p.ositive note in mid-session deals. Meanwhile, international oil benchmark Brent crude rose 2.26 per cent to USD 74.73 per barrel
The market opened with Sensex over 400 points tracking gains in index majors Reliance Industries, Kotak Bank and HDFC Bank amid a positive trend in global markets.
The 30-share index was trading 444.17 points or 0.78 per cent higher at 57,191.31 in initial deals. Similarly, the Nifty rose 131.60 points or 0.78 per cent to 17,043.85.
Tata Steel was the top gainer in the Sensex pack, rising over 2 per cent, followed by Kotak Bank, Axis Bank, Maruti, IndusInd Bank and SBI. On the other hand, Dr Reddy’s, Tech Mahindra, L&T, Bharti Airtel and HCL Tech were among the laggards.
Updates from Monday:
The BSE Sensex on Monday slipped by 949.32 points or 1.65 per cent to close at 56,747.14, a day after India reported 17 new cases of the Omicron variant of the deadly COVID-19 infection. Similarly, Nifty was down by 284.45 points or 1.65 per cent as it closed at 16,912.25.
Bajaj Finserv and IndusInd Bank were the biggest losers in the Sensex as they were down by 3.3 per cent and 3.7 per cent respectively. TCS, HCL Technologies, Tech Mahindra, Infosys, Dr Reddy’s, Asian Paints, Maruti and NTPC were also trading in red.
Earlier in the day, the Sensex tumbled over 300 points or 0.54 per cent to open at 57,385.35. On the other hand, the Nifty fell 81.70 points or 0.48 per cent to 17,115.
The poor show of the stock market could be blamed on the Omicron strain that continues to spread across the United States (US), Europe, South Africa and other parts of the world. On Sunday, India also reported 17 new cases of the Omicron variant, taking the country’s tally to 21 that could have sparked fears among the investors.
Experts believe that the stock market could see a further dip in the next week as countries reimpose travel restrictions due to Omicron.
“The near term trend of Nifty continues to be down and the recent pullback rally of a down trend seems to have completed. There is a possibility of further weakness down to 16800 levels by next week. Immediate resistance is placed at 17300-17350 levels,” Financial Express quoted Nagaraj Shetti, Technical Research Analyst at HDFC Securities, as saying.
Meanwhile, Vijayakumar, the Chief Investment Strategist at Geojit Financial Services, said: “The latter is unlikely to be market-moving since MPC is likely to continue with the accommodative stance and status quo on policy rates. The market-moving factor will be the news regarding Omicron”.
Elsewhere in Asia, bourses in Hong Kong and Tokyo were trading with losses in mid-session deals, while Shanghai and Seoul were positive. Meanwhile, international oil benchmark Brent crude rose 1.99 per cent to USD 71.27 per barrel.
