Stock Market: Ahead of RBI meet, indices make smart recovery with metals in lead

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By S Jha

New Delhi, August 9: Shrugging off fear of the uncertainty of the Monetary Policy Committee meeting of the Reserve Bank of India on Thursday, the indices on Wednesday witnessed a turnaround of the fortune as Nifty recovered almost 170 points from the day’s low. Experts have maintained a near consensus that the RBI MPC will stick to the status quo on the policy rates even while there may be hawkish undertones to the commentary on the inflation guidance in the wake of the galloping tomato prices.

Nifty slid in the early session and soon was down with over 100 points. The early sessions saw the phama scrips extending gains with the likes of Lupin, Aurobindo Pharma and Laurus Lab leading the charge. Dr Reddy’s Laboratory was the star of the day, touching the level of Rs 5875 during the day, which is the highest level of the Hyderabad-based firm for several months.

Dixon technology too shot up over Rs 4900 level. But Nifty cracked and the Bank Nifty also dived alongwith. Both the indices were in deep trouble. But Nifty held its support level of 19476 and from there the smart recover in the index was seen with the metal leading the charge.

While the foreign institutional investors once more ended the day with a net sell in the cash market, the domestic fund houses brought the relief in the market as they bought the scrips on the dips. Buy on dip is the sentiment seen in the market as the inflation commentary continues to cash shadow over the direction of the bourses.

The metal sector joined the recovery efforts with once more JSW Steel leading the charge as the scrip soon raced to the level of Rs 828. It was in the good company of Hindalco, which also touched the level of Rs 468 on the back of its quarterly result. Zen Technology, the defence scrip, continues to sizzle after reporting a healthy set of numbers in its quarterly result by gaining another nine per cent in the day.

Tata Motors and Mahindra and Mahindra also had a stellar day on the street. The management of the Tata Motors has said that the domestic business will go debt free in the current fiscal, which is something which is being repeatedly spoken by the firm. Mahindra and Mahindra is also buzzing on the theme of the foreign fund infusion in its electric vehicle arm. Tech Mahindra extended the gain further, while a few more stocks such as Aditya Birla Fashion, Voltas, PVR and others made good gains.