Subdued inflation forecast boosts Indian equities (Roundup)

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Mumbai, April 5 (IANS) Key Indian equity indices on Thursday made healthy gains after the Reserve Bank of India (RBI) lowered its inflation forecast for the fiscal and projected a positive growth outlook.

The forecast led the two key indices — BSE Sensex and NSE Nifty50 — to their biggest intra-day gains since March 12. The BSE Sensex soared by over 500 points, while the NSE Nifty50 rose by almost 200 points.

Besides, positive global cues on the back of receding trade war concerns gave a boost to investors’ risk-taking appetite, said market observers.

In the process, the wider Nifty50 of the National Stock Exchange (NSE) reclaimed the 10,300-mark. The index surged by 196.75 points or 1.94 per cent to close at 10,325.15 points.

The barometer 30-scrip Sensitive index (Sensex) of the BSE closed at 33,596.80 points — up 577.73 points or 1.75 per cent from its previous session’s close.

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The BSE market breadth was bullish with 2,083 advances and 627 declines.

In terms of the broader markets, the S&P BSE mid-cap index edged higher by 1.88 per cent and the small-cap index by 1.87 per cent.

“Markets witnessed a hefty rally on Thursday after correcting sharply in the previous trading session,” Deepak Jasani, Head – Retail Research, HDFC Securities, told IANS.

“Positive global cues also helped the market sentiments. Major Asian markets closed on a positive note. European indices like FTSE 100, DAX and CAC 40 traded in the green,” he added.

Vinod Nair, Head of Research, Geojit Financial Services, said: “Market rallied owing to ease in global trade anxiety and RBI’s stance on cut in inflation to 4.7-5.1 per cent in H1FY19 due to sharp moderation in food prices and expectation of normal monsoon.”

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The central bank at the first bi-monthly monetary policy review of the new fiscal lowered its inflation forecast for the first-half of the current fiscal to between 4.7 per cent and 5.1 per cent, and 4.4 per cent for the second-half, “including the HRA impact for central government employees, with risks tilted to the upside”, according to the RBI monetary policy statement.

On the currency front, the Indian rupee strengthened by 18 paise to close at 64.97 against the US dollar from its previous close at 65.15.

In terms of investments, provisional data with the exchanges showed that foreign institutional investors sold scrips worth Rs 108.02 crore, while the domestic institutional investors purchased stocks worth Rs 615.28 crore.

All the 19 sub-indices of the BSE gained, led by the S&P BSE banking index, which augmented by 749.06 points, followed by metal index by 543.20 points and the auto index by 439.20 points.

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Major Sensex gainers on Thursday were: State Bank of India, up 4.66 per cent at Rs 258.40; Tata Motors (DVR), up 3.95 per cent at Rs 206.75; Tata Steel, up 3.67 per cent at Rs 581; ICICI Bank, up 3.52 per cent at Rs 277.90; and Kotak Bank, up 3.38 per cent at Rs 1,114.60.

Bharti Airtel was the sole BSE loser with a decline of 0.14 per cent at Rs 393.95 per share.



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