Sensex zooms 1,016 pts on global cues, RBI boost

PTI, Dec 8, 2021, 5:24 PM IST

Mumbai:  The Sensex skyrocketed 1,016 points while the Nifty rallied past the 17,400-mark on Wednesday as easing concerns over the Omicron variant and RBI’s accommodative policy stance galvanised investor sentiment.

Bulls were enthused by a positive trend in global markets amid reports that the new coronavirus strain is unlikely to be more severe than the Delta variant, removing market concerns regarding its economic impact.

Extending its winning run to the second straight session, the 30-share BSE Sensex zoomed 1,016.03 points or 1.76 per cent to finish at 58,649.68. This was its biggest single-day jump since March 30 this year, when it had surged 1,128.08 points.

Similarly, the broader NSE Nifty rallied 293.05 points or 1.71 per cent to 17,469.75.

Bajaj Finance was the top gainer in the Sensex pack, spurting 3.67 per cent, followed by Maruti, SBI, Bajaj Finserv, Asian Paints, ICICI Bank and Infosys.

In contrast, Kotak Bank and PowerGrid were the only laggards, slipping up to 0.85 per cent.

The Reserve Bank of India (RBI) on Wednesday kept borrowing costs at a record-low for the ninth consecutive time as it decided to continue supporting economic growth.

The six-member Monetary Policy Committee (MPC), which has paused rate changes since August last year, unanimously decided to keep the benchmark repurchase rate at 4 per cent and voted 5-1 to retain its accommodative policy stance as long as necessary.

The central bank also kept the GDP growth projections unchanged at 9.5 per cent for the current fiscal and retained the inflation forecast of 5.3 per cent for the full year.

“Fears over Omicron faded as recent reports suggested that the new virus isn’t deadly as earlier anticipated and this helped the market to add-on to recent strong gains.

“The market turned positive over RBI’s continued accommodative stance and MPC kept the rates unchanged. The GDP forecast for FY22 remained high at 9.5 per cent showing confidence over economic recovery and inflation forecast is below the market estimates,” said Vinod Nair, Head of Research at Geojit Financial Services.

S Ranganathan, Head of Research at LKP Securities, said, “Positive global cues, coupled with the continuation of an accommodative policy stance of the RBI by holding rates fired up the bulls even as the central bank decided to enhance the variable reverse repo rate auctions to rebalance liquidity.”

The bullish undertone was reflected in the sectoral indices and advance-declines as the market breadth was healthy with small and midcaps too participating in the rally, he noted.

Most of the rate-sensitive auto, financial and realty stocks ended in the green.

All sectoral indices ended on a positive note, with BSE auto, teck, telecom, IT and metal indices climbing as much as 2.24 per cent. Broader BSE midcap and smallcap indices rose up to 1.50 per cent.

Global equities mostly continued their post-Omicron rebound. In Asia, bourses in Shanghai, Hong Kong, Seoul and Tokyo ended with significant gains.

Stock exchanges in Europe were, however, largely negative in mid-session deals.

Meanwhile, international oil benchmark Brent crude inched up 0.60 per cent to USD 75.89 per barrel.

The rupee staged a smart recovery from intra-day lows to close with a marginal 2 paise loss at 75.46 against the US dollar.

Foreign institutional investors remained net sellers in the capital.