The US parliament passed a massive $900 billion stimulus package that lifted sentiments but concerns over a new strain of the coronavirus also affected markets, especially broader indices that still underperformed their larger peers.
Analysts have cautioned that the market has become extremely expensive and a correction is warranted. On Monday, the indices crashed but, apparently that was one off blip in the larger bull run.
The 30-share pack Sensex added 452.73 points or 0.99 per cent to 46,006.69. Its broader peer NSE Nifty advanced 137.90 points or 1.03 per cent, to 13,466.30. India VIX dipped nearly 5 per cent.
In the largecaps, Adani Ports was the biggest gainer, up 5.55 per cent, while HCL Tech, Tech Mahindra, Infosys, Sun Pharma, JSW Steel, Divi’s Labs, Wipro and Power Grid were other gainers.
Kotak Mahindra Bank, HDFC, Bajaj Finance, UltraTech Cement, IndusInd Bank, Reliance Industries and Hindalco were among those that traded in the red.
Broader markets also recovered but underperformed their headline peers. Nifty Smallcap climbed 0.77 per cent and Nifty Midcap rose 0.85 per cent. Nifty 500, the broadest index on NSE was up 1.02 per cent.
Factors driving the market today:
US votes for stimulus
A majority of the US House of Representatives voted to move a $900 billion coronavirus aid bill struck by Congressional leaders for a vote on passage on Monday evening. Economists expect the package to support the pandemic-ravaged economy and set it up for a stronger recovery next year as vaccines become more widely available.
Vaccination in Europe
The European Union geared up to start mass vaccinations against COVID-19 just after Christmas after Pfizer and its German partner BioNTech’s vaccines cleared regulatory hurdles on Monday.
Global markets gain
European markets opened higher, setting the mood for recovery. Shares in Germany and France gained over a per cent each. London-based FTSE climbed 0.38 per cent. However, most Asiam markets closed in the red barring Thailand that advanced 1.61 per cent.
