Stocks wilt on border skirmish
Indian equities on Tuesday followed upbeat global markets to capture the day’s peak before losing momentum because of the India-China border tensions that capped gains on benchmark indices.
The BSE gauge Sensex settled 376.42 points, or 1.13 per cent, higher at 33605.22. Intra-day, the index swung about 1069 points, and briefly ventured into the negative territory in the later part of the session, reacting to India-China standoff news.
Likewise, the NSE barometer too fought a high volatility before ending 100.30 points, or 1.02 per cent, up at 9914.
On the Sensex chart, HDFC Bank was the top gainer, jumping around 4 per cent, followed by HDFC, ICICI Bank, Kotak Bank, Infosys and Hero MotoCorp. Tech Mahindra, Axis Bank, IndusInd Bank and ITC were among the laggards.
Of the Sensex constituents, 15 shares closed in the red and as many scrips in the green.
Sectorally, BSE finance, bankex, metal, basic materials, IT and consumer durables indices rallied up to 2.39 per cent. Telecom, realty, power, utilities and FMCG indices ended in the red.
In the broader market, midcap and smallcap indices jumped up to 0.37 per cent.
Indian bourses tracked positive global markets after the US Federal Reserve launched a massive programme to support businesses hit by the coronavirus lockdown, analysts said. The Fed announced its Main Street Lending Programme and an emergency lifeline under which it will buy up to $750 billion in corporate bonds.
The plan is part of a massive financial backstop put in place by the bank to protect the economy from the worst of the virus crisis.
“The border dispute between India and China resulted in volatility in the stock markets, on tensions of further escalation of dispute. This was in spite of steady global markets following the announcement of the US Fed Reserve’ expanded bond-buying programme,” Vinod Nair, head of research at Geojit Financial Services, said.
Investors seem to have set aside the news emerging from the border and are still hoping that liquidity will keep propping the markets for the time being, he said.
Bourses in Shanghai, Hong Kong, Tokyo and Seoul ended up to 5 per cent higher. Stock exchanges in Europe too opened with significant gains.
Rupee pares gains
On the currency front, the rupee pared initial gains and closed 17 paise lower at 76.20 against the US dollar. The rupee opened the day on a strong note at 75.89 and touched a high of 75.77 later. The local unit, however, slid to a low of 76.26 before settling at 76.20 against the US dollar, down 17 paise over its previous close.
It had settled at a more than six-week low of 76.03 against the greenback on Monday.
International oil benchmark Brent crude futures rose 1.41 per cent to USD 40.28 per barrel.