Sensex jumps 574 points; FOMC minutes signal less hawkish approach

The Federal Open Market Committee FOMC minutes, which hinted towards a less hawkish approach to the coming policies, are expected to start a rally in global equity. India's forex reserves have gone up by $2.537 billion to $547.252 billion for the week ending November 18. Fitch Ratings believes that India's bank credit will see strong growth in the current financial year despite higher interest rates.

These positive signals helped the BSE Sensex to gain 574.86 points, or 0.92 per cent, at 62,868. The Nifty fell to 18.696 during the week ending December 02, and 183.35 points, or 0.99 per cent, during the week ending December 02. In the past week, Nifty and Sensex have gone up around 0.8%, according to market veteran Shrikant Chouhan, head of equity research retail at Kotak Securities. The BSE Midcap Index gained 1.63%, while the BSE SmallCap Index gained 1.94%. Equity markets continued the momentum and helped the Nifty 50 Index reach a new all-time high on a closing basis, despite a gradual easing of global bond yields on expectations of peak inflation and a decline in crude prices. FPIs were net sellers in the past five trading sessions, while DIIs were net sellers in the same period. D-street will focus on macro trends going forward. Markets may be dominated by global news flows and steps taken by different governments to tackle their economies going forward. On the economy front, Q 2 FY 23 real GDP grew by 6.3%, while GST collections for October in November stood at Rs 1.469 lakh cr September, according to Rs 1.517 lakh cr Chouhan.

As many as 41 stocks in the Nifty 50 index delivered a positive return to investors in the past week. Britannia Industries came in at the top of the index with a gain of 5.8 per cent. Tata Steel increased 5.5 per cent Ultratech Cement, up 5.3 per cent Bharat Petroleum Corporation and Grasim Industries up 5.0 per cent, and Hindalco Industries, Hero MotoCorp and Reliance Industries also increased by over 4 per cent. Eicher Motors, Maruti Suzuki India and Coal India declined 2.4 per cent, 2.2 per cent and 2.1 per cent, respectively.

The BSE Realty index gained 4.2 per cent during the week gone by. BSE Metal also gave a 3.4 per cent return. BSE Fast Moving Consumer Goods, BSE Information Technology, BSE Oil Gas, BSE Carbonex, BSE Teck and BSE Healthcare indices also surged more than 1 per cent during the week.

Market strategist Vinod Nair, Head of Research at Geojit Financial Services, said the rally in the domestic market was halted due to negative cues from global counterparts and broad-based profit booking in large caps. The sales data came in lower than expected due to weaker exports and sequential de-stocking, which led to a correction in the market. Declining manufacturing activity in the US is proof that the central bank has started to show results, which will in turn encourage the Fed to keep rate hikes at bay.