Indian markets rebounded strongly today, with banking stocks leading the gains. The Sensex settled 645 points higher at 38,177 while the broader Nifty surged 1.7% to 11,313. The index for banking stocks, Nifty Bank, surged 3.7% to 28,795 while the Nifty auto index also logged 1.4% gain. IndusInd Bank, SBI, ICICI Bank, Kotak Mahindra Bank and HDFC Bank surged between 3.5% and 5.5%.
The Nifty Bank index had fallen 10.5% in the past six sessions.
Some weakness was seen in IT stocks with TCS falling 1.5% and HCL Tech declining 2%.
Financial results from TCS are expected on Thursday, marking the start of the quarterly results season. Company earnings for the year ending March 2020 are expected to receive a boost after the government slashed corporate taxes last month to 22% from 30%.
Ahead of Diwali, the union government today decided to hike dearness allowance by 5% for central government employees and and pensioners from 1 July. This increase is based on the recommendations of the 7th Pay Commission.
This is one of the steepest hikes in DA and will benefit 50 lakh employees and 65 lakh pensioners. The cost to the exchequer will be ?16,000 crore.
Rohit Singre, senior technical analyst at LKP Securities, said Nifty has resistance near 11,400 zone and any decisive close above 11,400 zone could push markets even higher.
Nifty Bank index has support at 28,530-28,300 zone and resistance near 29000-29200 zone, he added.
Yes Bank’s shares, which have been volatile over the past few weeks amid stake sales by the lender’s promoters and concerns over its exposure to troubled real estate firms, today fell 5%. Titan dived 2% after the watch and jewellery maker flagged lean sales.
Indian markets had closed lower for the sixth straight session on Monday.
News Source: livemint