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Investors look beyond Covid cases' surge; Sensex zooms 790 pts; banks rally

CLSA opines that the surge in Covid cases in Maharashtra may taper in May as the state is in its fourth-month of the second wave. This, it believes, will be positive for the markets

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MARKET WRAP | Q4 Results | Markets Sensex Nifty

SI Reporter  | New Delhi 

EVENT HIGHLIGHTS

MARKETS: Banks, autos drive Sensex 750 pts higher; Nifty above 14,850
Stock market update: Expectations that Covid-19 cases could soon peak in the country, especially in the economically important state of Maharashtra, boosted investor confidence on Dalal Street on Wednesday. Besides, healthy buying in the financial counters ahead of the monthly expiry of the F&O contracts of April due tomorrow further lifted benchmark indices 1.6 per cent on Wednesday. Today was the third consecutive day of gains at the bourses.

Maharashtra’s stabilising Covid cases could be a precursor to India's curve flattening over one-two months, believes Amish Shah, India equity strategist at BofA Securities. Meanwhile, CLSA opines that the surge in Covid cases in Maharashtra may taper in May as the state is in its fourth-month of the second wave. This, it believes, will be positive for the READ MORE

In effect, the BSE barometer of 30-shares zoomed 790 points to end the day at 49,734 levels. In the intra-day deals, the index had vaulted 857 points to hit a high of 49,801. On the NSE, the broader index reclaimed the 14,800-mark for the first time since April 9 and closed at 14,864, up 211 points. It hit a high of 14,890 earlier today.

Bajaj Finance, up 8 per cent, was the top Nifty gainer today after the consumer durable financier, on Tuesday, reported a 42 per cent jump in consolidated net profit at Rs 1,347 crore for the fourth quarter of the fiscal ended March 2021. Brokerages remain mixed on the stock as expensive valuations, analysts say, may overweigh possible strong growth in AUM going-forward. READ MORE

That apart, Eicher Motors, IndusInd Bank, Bajaj Finserv, ICICI Bank, Kotak Mahindra Bank, SBI, and Bajaj Auto were the other outperforming stocks on the 50-share index. 

On the downside, Britannia Industries, Hindalco Industries, HDFC Life, Nestle India, HCL Tech, and Tata Steel were the top laggards in a firm market. The stocks ended lower between 0.5 per cent and 2 per cent.

Broader markets, however, witnessed relatively leaner trade today. The S&P BSE MidCap index ended 0.99 per cent up while the S&P BSE SmallCap index added 0.7 per cent.

Among key sectoral indices, the Nifty Realty index dropped 0.6 per cent amid fears that the second wave of Covid-19 may hit housing demand. That apart, the Nifty Metal and Pharma indices slipped 0.3 per cent each.

On the contrary, the Nifty Bank index soared 3 per cent on the NSE today and ended at 33,723. The Nifty Private Bank, PSU Bank, and Financial Services indices too climbed over 2.5 per cent each. 

Global markets
World shares cosied up close to record highs and the dollar and global bond yields nudged up on Wednesday, as traders waited to see if the U.S. Federal Reserve utters the dreaded ‘T’ word later - tapering of its mass stimulus programme.

Japan's Nikkei ended 0.2 per cent up, South Korea's Kospi declined 1 per cent, and Australia's S&P/ASX200 index gained 0.44 per cent.

European stocks inched higher on Wednesday on expectations of a bumper earnings season following strong results from Deutsche Bank, Lloyds Banking Group and other lenders.

The pan-European STOXX 600 index rose 0.1 per cent in early trading, with the region’s banking sector up 1.1 per cent.

(With inputs from Reuters)

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