Sensex Rallies 567 pts, Nifty Nears 19,700; Pharma Stocks In Red

As the war between Israel and Palestinian militant group Hamas entered the fourth day today, Sensex recovered Monday’s loss to jump 600 points while Nifty crossed the hurdle at the 19,700 level. Small and midcap stocks, which faced most of the wrath in the previous session, sprung back to life quickly to reverse the losses.

That apart, the International Monetary Fund (IMF) on Tuesday raised its FY24 growth projection for India by 20 basis points to 6.3 per cent, which further bolstered optimism.

The S&P BSE Sensex jumped X567 points to end at 66,079 levels, while the Nifty50 ended near 19,700-mark at 19,690, higher by 178 points. Both the benchmarks added around 0.9 per cent each.

Coal India led the large-cap rally with over 5-per cent gains, followed by Adani Ports (up 3.5 per cent), Bharti Airtel, Hindalco, Adani Enterprises, Kotak Bank, UPL, Tata Motors, JSW Steel, ICICI Bank, Tata Steel, Grasim, Axis Bank, M&M, Tech M, Infosys, ONGC, SBI, Maruti Suzuki, LTIMindtree, ONGC, HCL Tech, and ITC (up 1 per cent).

In the broader markets, the BSE MidCap and SmallCap indices outperformed the benchmarks with a rally of over 1 per cent each.

Sectorally, the Nifty Realty index jumped close to 4 per cent, while the Nifty PSU Bank and Metal indices added over 2 per cent each.

Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said: “The uncertainty associated with the Israel- Hamas war continues. It can take a turn for the worse if Israel starts ground operations in Gaza. The possibility of easing of tensions also cannot be ruled out since Hamas will bargain with the captured Israeli hostages. Unlike economic and market trends, geopolitical developments cannot be predicted. This uncertainty will weigh on markets.”

“On the economic front there are some positive developments. The decline in the dollar index to 105.95 and the US 10-year bond yield falling to 4.65 from the recent high of 4.88 are positive developments for equity markets. Even though FIIs continue to sell in India, the intensity of selling is coming down. More importantly. DIIs are increasing their purchases,” he said.

Calibrated buying in small quantities in quality stocks in banking, automobiles, IT, capital goods and real estate/construction would be a good strategy for long-term investors, he added.