Stock Market: Bottom up brings relief rally; Powel decoding tires US bourses
By S Jha
New Delhi, February 8: A day before the weekly option expiry, Sensex and Nifty zoomed on the US cues even while the Bank Nifty was caught in doubt zone after the Reserve Bank of India effected another hike of Repo Rate by 25 basis point. The Tuesday rally in the US markets lifted the broader market. Strong gains on Nasdaq invited investors’ interest in the IT heavyweights.
Also, Adani Enterprises and Adani Port and SEZ sharply climbed, gaining strength from short-covering, on a day when Prime Minister Narendra Modi replied to the debate on the motion of thanks to the address of President Droupadi Murmu to the joint session of the two Houses of Parliament. Adani Enterprises gained over 22 per cent. Adani Port and SEZ also gained more than eight per cent. Adani Enterprises has almost doubled from its low of Rs 1014 a few days ago. However, Adani Green and Adani Gas are yet to come out in the green territory after they had been hammered in the whipsaw in the group companies following the report of the US-based Hindenburg Research.
On Wednesday, the market saw bottom up trading, as decimated scrips such as Bajaj Finance and HDFC Life Insurance strongly gained. Both the scrips had been hammered in the recent weeks, losing much of the shine. The index heavyweight Reliance Industries also gained strongly to give stability to Sensex and Nifty by rising by more than two per cent.
However, it was the secular rally in the IT scrips led by Infosys, which gained by more than two per cent, to send Nifty trending and launch short-covering in the index. The likes of HCL technology, TCS also joined the party. Infosys is being stated by chartists to have entered the strength zone, as the IT behemoth touched the level of Rs 1600 after a long gap. Infosys of late has been a sectoral leader for the IT space. Among the midcaps, the Pune-based Persistent Systems after the quarterly result has been in a one-direction trajectory, rising to the peak with each passing day.
While the metal space looked strong in the early session, only JSW Steel sustained the gains by the end of the session on Wednesday. With the weekly expiry on Thursday, the FII data is being watched out, as they seem mostly on the short side. The US markets were also trading with cuts as the traders were busy decoding the meaning of the statement of Jerome Powell, the chairman of the Federal Reserve, as he had spoken of the task of dealing with disinflation. The FIIs had a net sale of Rs 737 crores in the cash market.
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