Markets cheer Fed outcome; Nifty aims 8,800, Sensex up 300 points

Benchmark indices open higher with a gap up opening with Nifty reclaiming 8,750 after US Fed late on Wednesday night stated that  it would hold on for a little longer before considering raising rates, and would wait for both economic growth and inflation to stabilize.

At 9: 35 AM, the 30-share Sensex is up 311 points at 28,993 and the 50-share Nifty has gained 86 points at 8,772.

Meanwhile, foreign institutional investors were net sellers in equities to the tune of Rs 457.43 crore on Wednesday, as per provisional stock exchange data.

The US central bank removed a reference to being "patient" on rates from its policy statement, opening the door wider for a hike in the next couple of months while sounding a cautious note on the health of the economic recovery.

Fed officials also slashed their median estimate for the federal funds rate - the key overnight lending rate - to 0.625% for the end of 2015 from the 1.125% estimate in December.

"Just because we removed the word 'patient' from the statement doesn't mean we're going to be impatient," Fed Chair Janet Yellen said in a press conference after Wednesday's statement.

The dollar nursed punishing losses in Asia on Thursday after investors priced in a later start and a slower pace for future US rate rises, slashing Treasury yields and firing up Wall Street stocks.

The formerly friendless euro found itself up at $1.0835, having jumped 2.8% on Wednesday, while oil held gains of 5% as the dollar retreat lifted commodities.

Early signs were also promising for regional stocks with MSCI's broadest index of Asia-Pacific shares outside Japan.

Further, India is poised to grow 7.7% this year and 8% in 2016 to become the "fastest growing major economy", according to think-tank OECD. In its interim economic assessment report released today, OECD said that over the next two years India is set to grow faster than China, where growth is slowing towards the official target of around 7%.

KEY STOCKS

On the sectoral front, all sectoral indices are trading in the positive territory with BSE Capital Goods, Bankex, Metal, Consumer Durables indices trading higher over 0.8% each.

Country's largest private sector lender ICICI Bank today said it has sold its profit making Russian subsidiary ICICI Bank Eurasia Limited Liability Company (IBEL) to Sovcombank -- marking its exit from Russia. The stock is up over 1.5%. Also, Axis Bank, HDFC Bank and SBI are up between 0.5-1.5%.

The metal pack is gaining limelight in today’s trade with Sesa Sterlite, Hindalco, Tata Steel up over 0.85% each.

The government has firmed up a list of PSUs for divestment of minority stakes in the fiscal beginning next month, as it gears up to raise Rs 41,000 crore through such stake sales in 2015-16. The stock is up 0.5%. Its peer L&T has gained 1%.

The defensive stocks are gaining in the morning trades. Dr Reddy’s Lab, Wipro, Sun Pharma, HUL, ITC, TCS and Cipla are up between 0.3-1.5%.

HCL Technologies and Tech Mahindra are trading lower up to 1% as both the companies have fixed March 20, 2015 as record date for the purpose of ascertaining the entitlement of the members for the issue of bonus shares in the ratio of 1:1 i.e. one equity share for every one equity share held.

In the broader market, the BSE Mid-cap and Small-cap are trading in line with the large counterparts and are up 0.7% each.

Market breadth is strong with 1,115 gainers and 327 losers on the BSE.