The benchmark equity indices on the BSE and National Stock Exchange (NSE) surged nearly 2 per cent on Wednesday aided by banking, financial, metal and automobile stocks which helped the markets rebound amid strong global cues which rose as investors closely watched the US Federal Reserve for projections on its path of rate hikes this year.
The S&P BSE Sensex climbed 1,039.80 points (1.86 per cent) to settle at 56,816.65 while the Nifty 50 gained 312.35 points (1.87 per cent) to end at 16,975.35.
The rupee spurted by 41 paise to close at 75.80 (provisional) against the US dollar on Thursday, supported by positive domestic equities and broad dollar weakness.
At the interbank forex market, the local unit opened at 75.96 against the greenback and witnessed an intra-day high of 75.77 and a low of 75.97. The rupee settled at 75.80, registering a rise of 41 paise over its previous close of 76.21.
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(PTI)
"Global markets welcomed the fed decision to hike rates by 25bps as it was on expected lines. However, the Fed’s projection of another six hikes during the year is hawkish. FIIs turning net buyers after a long wait was also a relief for the domestic market. With crude prices receding, war tensions calming down and foreign investors back to buying, we can expect the rally in the domestic market to continue"
The S&P BSE Sensex ended at 57,863.93, up 1,047.28 points or 1.84 per cent, while the Nifty 50 settled at 17,287.05, up 311.70 points or 1.84 per cent.
"The rate hike by Fed was on expected lines due to high inflation risk coupled with geopolitical tensions. The US treasury yields had shown an immediate spike after the FOMC announcement but stabilized thereafter. The current rate hike along with anticipated monetary tightening indicates the Fed's stance of controlling the high inflation prevalent in the US.
Asian markets have reacted positively on account of the Russia-Ukraine situation entering the resolution phase which was further supported by stabilization of crude prices. Taking this into account, the RBI may reassess its accommodative stance in the next month’s policy meeting"
"The first hike of 0.25% by Fed since Dec 2018 was on expected lines and it was lower than what some of the market participants have feared. More importantly, Fed has cleared the uncertainty around the future hikes to a large extent with indication of 25 bps increase in each of the remaining next six occasions. The increase in policy rate was accompanied by a strong commentary on economic growth which buoyed the market. Another factor was the announcement made by China that they would likely be taking strong measures to boost the Chinese economy in coming quarter. We remain quite cautious as 2020 is expected to be a challenging and volatile year for equity markets. An amicable and quick resolution of Ukraine-Russia conflict along with stabilization of energy prices will be critical going forward."
Moody’s on Thursday slashed India’s growth estimate for the current year to 9.1 per cent, from 9.5 per cent earlier, saying high fuel and fertilizer import bill could limit the government’s capital expenditure.
In its ‘Global Macro Outlook 2022-23 (March 2022 Update): Economic Growth will suffer as fallout from Russia’s invasion of Ukraine builds’ report, the rating agency said Russia’s invasion of Ukraine has significantly altered the global economic backdrop through three main channels — spike in commodities prices, risks to global economy from financial and business disruption and dent in sentiment due to heightened geopolitical risks. CLICK HERE to read
Prices of petrol and diesel remained unchanged across the country on Thursday, March 17, 2022.
The price of petrol in Delhi stands at Rs 95.41 per litre while that of diesel is at Rs 86.67. In Mumbai, petrol currently costs Rs 109.98, while diesel is retailing at Rs 94.14, data available on Indian Oil Corporation’s website showed. CLICK HERE to read
"Fed has embarked on rate hiking cycle and has guided for an aggressive normalization, as it deems to be the quintessential tool to normalize the High Inflation. The aggressive rate hike outlook has come in response to U.S. witnessing a run-away Inflation exacerbated by rising commodity prices led by Geopolitical tensions & supply disruptions and posed with downside risks to global growth. However, with Fed alluding that economy is on a strong footing and that growth is strong, we reckon the rate hike cycle will be navigated much better this time. From the Indian market's standpoint, while the impending Fed rate hike has already resulted in strong selling by FII’s in the last few months, the strong support by DII’s has to a great extent mitigated the impact of FII selling. We reckon the markets will take this rate hike cycle in its stride, as prospects remain strong despite the inflationary headwinds and will navigate from the unknown to known territory."
The rupee advanced 32 paise to 75.89 against the US dollar in the opening trade on Thursday, supported by positive domestic equities, broad dollar weakness and softening crude oil prices.
At the interbank foreign exchange, the rupee opened at 75.96 against the US dollar and gained momentum to quote 75.89, a gain of 32 paise from the previous close. On Wednesday, the rupee spurted by 41 paise to close at a nearly two-week high of 76.21 against the American currency.
(PTI)
In its first hike since 2018, the US Federal Reserve on Wednesday raised interest rates by 25 basis points and outlined an aggressive stance that also includes balance sheet reduction aimed at fighting record high inflation. The Fed projected that its policy rate would hit a range between 1.75 per cent and 2 per cent by year’s end, arguing that the ongoing increases will be appropriate to curb inflation, the highest in 40 years at 7.9 per cent in February. It also cited the war in Ukraine as creating additional upward pressure on inflation, with global commodity prices remaining elevated.
Federal Reserve Chairperson Jerome Powell said at a press briefing that inflation is expected to start cooling off by the second half of the year and fall to its target level of 2 per cent by 2024. The strong US economy should be able to expand even with a less accommodative monetary policy. “All signs are that this is a strong economy, indeed, one that will be able to flourish, not to say withstand, but certainly flourish in the face of less accommodative monetary policy,” he said. CLICK HERE to read
Asian stock prices surged for a second day Thursday after the Federal Reserve announced its first interest rate hike since 2008 and China promised support for its real estate and internet industries.
Hong Kong's benchmark jumped 5.8% and Tokyo gained 3%. Shanghai, Seoul and Sydney advanced more than 1%.
Wall Street's benchmark S&P 500 index rose 2.2% on Wednesday after the Fed raised its short term lending rate by 0.25 percentage points. The move was widely expected but investors were reassured it was smaller than the 0.5 percentage point hike advocated by some officials.
The Hang Seng in Hong Kong rose to 21,246.76, adding to the previous day's explosive 9.1% gain. The Nikkei 225 in Tokyo surged to 26,508.77 and the Shanghai Composite Index advanced 2.6% to 3,252.96. The Kospi in Seoul was 1.8% higher at 2,706.65 and Sydney's S&P-ASX 200 added 1.1% to 7,252.20. New Zealand and Southeast Asian markets also gained.
(AP)
Sensex surges 846.31 points to 57,662.96 in opening session; Nifty climbs 236.80 points to 17,212.15.
(PTI)