In a volatile trade ahead of the release of Q2 GDP data, the Sensex on Wednesday rose 26 points to 62,708 in the early morning trade and the Nifty was up 22 points to 18,640. The rupee on Wednesday appreciated 17 paise to 81.55 against the US dollar in the early trade, on broad dollar weakness and a positive trend in domestic equities.
In the broader markets, the BSE MidCap and SmallCap indices were also up by 0.32 per cent and 0.4 per cent, respectively.
Among the 30 shares of the Sensex, HCL Tech, Tech Mahindra, Infosys, Wipro and TCS were the biggest losers. On the other hand, Dr Reddy’s, Tata Steel, Mahindra and Mahindra, Nestle India and Asian Paint were the biggest gainers.
V K Vijayakumar, chief investment strategist at Geojit Financial Services, said, “An important feature of the ongoing rally which has taken the Sensex and Nifty to record highs is that this is a mature rally led by high-quality stocks in performing sectors. There is no celebration in the market because this rally has largely bypassed the broad market. While the Nifty is up 7.2 per cent YTD, the Nifty SmallCap Index is down by around 12 per cent YTD. So, the vast majority of retail investors whose portfolios are predominantly small cap oriented, have not benefited from this rally."
Vijayakumar added that this experience also underlines the importance of investing in quality stocks. Since the valuations are elevated from a near-term perspective, there is no scope for the rally to continue unabated. Profit booking and DII selling at higher levels can trigger corrections. The Fed chief’s observations today will be important for global markets. Markets expect indications of slowing down the rate hikes. Any comments to the contrary will be negative for markets.
On Tuesday, the Sensex and Nifty had ended at fresh lifetime peaks. The 30-share BSE Sensex had gained 177.04 points or 0.28 per cent to settle at 62,681.84, its fresh record closing high. The broader NSE Nifty had advanced 55.30 points or 0.30 per cent to end at 18,618.05, its fresh record closing high.
The Rupee Gains 17 Paise
The rupee appreciated 17 paise to 81.55 against the US dollar in early trade on Wednesday on broad dollar weakness and a positive trend in domestic equities. At the interbank foreign exchange, the domestic unit opened at 81.63 against the dollar, then gained ground to touch 81.55, registering a rise of 17 paise over its previous close.
On Tuesday, the rupee declined 4 paise to close at 81.72 against the US dollar. Forex traders said investors will focus on the US Federal Reserve Chairman Jerome Powell’s speech and the release of key domestic macro economic data for further cues.
“Market is looking forward to Fed Chair Powell’s speech today. He is likely to signal a slowdown in the pace of rate hikes but push back against expectations of a pivot," IFA Global Research Academy said in a note.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.15 per cent to 106.65. Brent crude futures, the global oil benchmark, advanced 1.14 per cent to $83.98 per barrel.
Domestic Q2 FY’23 GDP print, April-October fiscal deficit and October core sector data are scheduled to be released later in the day.
Foreign Institutional Investors (FIIs) were net buyers on Tuesday as they bought shares worth Rs 1,241.57 crore, according to exchange data.
(With Inputs From PTI)
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