Sensex ends 138 points higher, Nifty nears 23,500; Axis Bank up 2%

The BSE Sensex opened at 74,742.54 and closed at 74,902.59, gaining 138.36 points, or 0.19%. The Nifty 50 opened at 23,446.60 and ended at 23,477.80, up 46.30 points, or 0.20%.

In Short

• Brent crude stays above $100, raising inflation and import bill concerns
• Power and banking stocks lead gains, HCLTech and Tata Steel fall
• Market cautious due to US inflation data and Middle East tensions

Benchmark indices snapped their losing streak on Thursday, ending higher despite Brent crude remaining above the $100-a-barrel mark as investors took some comfort from buying in key large-cap stocks.

Gains, however, remained limited amid elevated oil prices, geopolitical tensions and uncertainty over the US Federal Reserve's rate trajectory.

The BSE Sensex opened at 74,742.54 and closed at 74,902.59, gaining 138.36 points, or 0.19%. The Nifty 50 opened at 23,446.60 and ended at 23,477.80, up 46.30 points, or 0.20%.

Brent crude was trading at $102.24 a barrel, up 1.02%, while WTI crude rose 1.53% to $97.52. Oil prices remained elevated as the Middle East conflict continued to raise concerns over supply disruptions. Sustained crude prices above $100 are a concern for India as they can increase the import bill, add to inflationary pressures and weigh on corporate earnings.

The market's recovery came after both the Sensex and Nifty had fallen for seven of the previous eight sessions, with the benchmarks ending Wednesday at three-month lows.

Vinod Nair, Head of Research, Geojit Investments Limited, said, that the prospect of synchronised monetary tightening strengthened as higher crude prices and prolonged geopolitical tensions reinforced energy-led inflation concerns.

"Investors now await key US inflation data for cues on the rate trajectory. Meanwhile, rising global bond yields, coupled with concerns over a potential yen carry trade unwind amid expectations of a BOJ rate hike and a stronger yen, are likely to keep capital flows into emerging markets under pressure," he added.

"Consequently, the domestic market endured a choppy session on expiry day amid weak Asian cues, as investor focus remained closely tethered to the volatility in crude prices. Although the strong August equity fund flow data and the moderation in the SIP stoppage ratio lent support to the markets, sentiment was tempered by the depreciating rupee and firming domestic bond yields," said Vijaykumar.

POWER, BANKING STOCKS LEAD GAINS

Power stocks led the recovery among major Sensex constituents. PowerGrid was the top gainer, rising 2.27%, followed by Axis Bank, which gained 1.65%. UltraTech Cement advanced 1.44%, NTPC rose 1.13%, Tech Mahindra gained 1.09% and Bharti Airtel climbed 1%.

HDFC Bank gained 0.98%, while L&T, Kotak Mahindra Bank and Bajaj Finance rose 0.76%, 0.62% and 0.58%, respectively. Titan gained 0.40%, TCS rose 0.34% and SBI advanced 0.29%.

On the losing side, HCLTech fell 2.43%, Tata Steel declined 1.38% and Trent dropped 1.12%. ITC fell 0.84%, while BEL and Adani Ports declined 0.79% each. Maruti slipped 0.78% and Reliance Industries fell 0.47%.

The broader sectoral picture remained mixed. The Nifty Financial Services 25/50 index gained 0.53%, while Media rose 0.55%, PSU Bank advanced 0.39%, Private Bank gained 0.34%, Financial Services Ex-Bank rose 0.31% and Consumer Durables edged up 0.06%.

Oil & Gas gained 0.01%, while Realty was almost flat, declining 0.02%.

On the other hand, Nifty Metal fell 0.65%, Pharma declined 0.51%, Auto dropped 0.41%, FMCG fell 0.27% and Healthcare declined 0.38%. Nifty MidSmall IT & Telecom was down 0.77%, while Nifty IT declined 0.08%.

Chemicals fell 0.03%, while Nifty MidSmall Healthcare declined 0.52%. Nifty 500 Healthcare fell 0.31%.

The broader market remained weaker than the benchmark indices. The Nifty 100 gained 0.08%, while Nifty 200 fell 0.02% and Nifty 500 declined 0.03%.

The Nifty Midcap 50 fell 0.36%, Midcap 100 declined 0.38% and Smallcap 100 slipped 0.07%.

India VIX, a measure of expected market volatility, declined 1.71% to 11.72.

The recovery in the headline indices came even as crude remained above $100, with investors now looking towards US inflation data and developments in the Middle East for further cues. Elevated oil prices, global bond yields and currency volatility are likely to remain key risks for the Indian market in the near term.

(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)

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