Markets stay firm ahead of Fed policy; Auto, healthcare stocks led rally; Bajaj twins, Sun Pharma top gainers

Sensex surged by 139.91 points or 0.24% to end at 58,214.59. Nifty 50 jumped by 44.40 points or 0.26% to close at 17,151.90. Bank Nifty also surged over 104 points.

In the broader market, on BSE, Smallcap index climbed nearly 147 points, while Sensex Next 50 advanced over 228 points. The Midcap index was marginally up.

In terms of sectoral indices, the BSE Auto and Healthcare index zoomed by 112 points and 179 points respectively. Broad-based buying was seen but with a marginal upside.

Vinod Nair, Head of Research at Geojit Financial Services said, “staying afloat in a volatile trade, the domestic market managed to remain positive, with the optimism that the global banking system issue is behind us. Additionally, the volatility brought in from western markets ahead of the announcement of Fed policy and release of high UK inflation, tested market sentiments. The market has factored a 25bps rate hike by Fed, and an in-line and less hawkish policy stance will attract bulls.”

Bajaj Finserv and Bajaj Finance were top gainers, soaring by over 2% each. Sun Pharma followed by gaining 1.7% and IndusInd Bank was up by 1%.

Among the top losers on Sensex was — NTPC down 1.5% followed by Axis Bank, Nestle, HCL Tech, and HDFC Bank.

Going ahead, Mitul Shah – Head of Research at Reliance Securities said, the markets will closely follow global cues and the developments in the US and European banking systems. Domestically, CPI and WPI have cooled and the trade deficit has narrowed. Brent crude prices have corrected 10% since the start of the US banking crisis which coupled with the cheaper crude from Russia and the fall in natural gas and coal prices is a huge tailwind for the Indian economy. However, the unseasonal rains this week have caused large-scale crop damage across large swathes of India. This is likely to keep food prices higher in the coming months. All eyes will be on the US Fed monetary policy meeting and its interest rate decision due tonight.

On Nifty 50, Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities said, the Nifty index witnessed sideways momentum throughout the day but the index managed to close in green. The index remains in a buy-on-dip mode as long as the index stays above 17,000. The immediate hurdle on the upside is at 17,200 where the highest open interest is built up on the call side. The index once surpassed the resistance will witness a sharp move on the upside toward the 17,500 level.

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