The market is taking cues from the experience of other countries where the curve of the second wave of Covid-19 flattened and fell in around two months. This explains the resilience of the market in the midst of very negative Covid-related news, said an analyst.
“An important point to understand is that global markets are highly correlated, and therefore, a major correction, when it happens, is likely to be global. Meanwhile, Q4 results continue to be good, particularly in high-quality financial, IT and cement stocks. FIIs have again turned buyers in the last two days. This is likely to pre-empt major shorting by the bears,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
How are the blue chip stocks doing?
After opening in the red, benchmark indices pared some losses. At 9:35 am, BSE flagship Sensex was down 274 points or 0.55 per cent at 49,491. NSE benchmark Nifty followed, dropping 66 points or 0.44 per cent to 14,829.
In the 50-share pack Nifty, ONGC was the biggest gainer, up 2.84 per cent. Wipro, Bajaj Auto, Tata Steel, Dr Reddy’s Labs, Divi’s Labs, Adani Ports, Sun Pharma and Grasim were among other gainers.
HDFC Bank was the top loser in the pack, down 2.83 per cent. HDFC, Titan, Bajaj Finserv, ICICI Bank, Tata Motors, Hero MotoCorp, Asian Paints and SBI were other losers in the pack.
FACTORS DRIVING MARKET
Good news
- US GDP: US economic growth accelerated in the first quarter as the government gave money to mostly lower-income households, fuelling consumer spending and setting the course for what is expected to be the strongest performance this year in nearly four decades.
Bad news
- Yields rise: The 10-year US Treasury yield rose to 1.690 per cent – its highest in more than two weeks, and last stood at 1.641 per cent.
- Covid rampage: For the ninth day in a row, India recorded over 3 lakh cases, inching closer to the 4 lakh mark with 3,86,693 cases on Thursday. The country reported 3,502 deaths, amid widespread reports of underreporting of fatalities with a gross mismatch of reported deaths and actual cremations across the country.
Broader markets
Broader market indices were trading on a mixed note but better than their headline peers in morning deals. Nifty Smallcap was up 0.30 per cent but Nifty Midcap down 0.19 per cent. The broadest index on NSE, the Nifty 500, fell 0.33 per cent.
SAIL, Sun TV, L&T Technology Services, Sequent, Alkyl Amines and Rossari Biotech were gainers from the space while Future Retail, Sterlite Tech, PVR, IndiaMart, AU SFB and Shriram Transport Finance were under selling pressure.
Global markets
MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 0.5 per cent with both Japanese and Chinese equities falling ahead of a long weekend. Both markets will be closed through Wednesday. Japan’s Nikkei fell 0.4 per cent while China’s CSI 300 lost 0.5 per cent in early trade.
MSCI’s broadest gauge of world stocks covering 50 markets, ACWI, was little changed, a day after it hit a historic high, extending its monthly gains to 5.1 per cent.
On Wall Street, the S&P 500 also closed at an all-time high while the Nasdaq Composite hit an intraday record before paring some gains.
