Why is Sensex rising: Sensex jumps 1,200 points, Nifty tops 8,400 amid firm global cues

NEW DELHI: Domestic equity indices rose in Tuesday’s session, tracking firm cues from global peers and on low level buying in blue chip stocks. The equity market resumed trading after a three-day gap.

Major world indices rallied for two days and Indian shares are seeing a jump to cover that spread. Apart from that there have been signs from highly affected areas of US and Europe that the intensity of virus spread is receding.

Meanwhile, investors also took positives from the news that India may attract $1.3 billion in passive flows as the country has moved into a new regime in which the FPI limit has been increased to the sector foreign limit.

BSE flagship Sensex jumped 1,186 points to 28,810 while NSE benchmark Nifty leaped 350 points to 8,434. Broader market indices were trading slightly lower than their headline peers as Nifty Smallcap gained 2.87 per cent while Nifty Midcap rose 2.90 per cent. Nifty 500 was up 3.63 per cent.

Among bluechip stocks, IndusInd Bank saw low level buying, jumping 10 per cent to Rs 344.55. Automaker Mahindra and Mahindra also saw a 10 per cent rise, trading at Rs 308.95 while private bank duo of ICICI Bank and Axis Bank gained around 7 pe cent each.

All but one constituent of the 30-share pack Sensex traded in the green. Bajaj Finance was the only loser in the pack, down 3.19 per cent at Rs 2,132.

All sectoral indices were trading with gains on NSE. Nifty Private Bank was the biggest gainer, up over 6 per cent, followed by Nifty Bank and Nifty Auto that added 5.64 per cent and 4.19 per cent, respectively.

Globally, Asian stock markets rallied for a second day on Tuesday, and riskier currencies rose, buoyed by tentative signs the coronavirus crisis may be levelling off in New York and receding in Europe.

The United States is bracing for its toughest week yet as the death toll climbs above 10,000 while across the Atlantic, British Prime Minister Boris Johnson has entered intensive care after his COVID-19 symptoms worsened.

Japan’s Nikkei rose 2 per cent and has erased most of last week’s losses after Prime Minister Shinzo Abe promised a massive $991 billion economic stimulus package – equal to 20 per cent of GDP.

MSCI’s broadest index of Asia-Pacific shares outside Japan pared early gains, but rose almost 1 per cent. U.S. stock futures eased 0.2 per cent following a 7 per cent surge on Wall Street on Monday.