Domestic markets on Friday staged a smart recovery on hopes of a stimulus package to revive the coronavirus-hit economy and a global equity rally. After opening on a volatile note and swinging over 2,485 points, the BSE Sensex zoomed 1,628 points or 5.75 per cent higher to 29,915.96. The NSE Nifty zoomed 482 points, or 5.83 per cent, to close at 8,745.45.
However, the Sensex plummeted 4,187.52 points, or 12.27 per cent, while Nifty sank 1,209.75 points, or 12.15 per cent, during the week. Analysts said the special COVID-19 economic task force announced by Prime Minister Narendra Modi is likely to work on an economic package for the sectors most affected by the outbreak as also people working in the informal sectors. India Inc has already sought steps like relaxation in NPA norms, deferral of tax payments and announcement of income support to the people working in the unorganised sector.
Recovery due to global cues, unsold positions
Markets managed to gain nearly 6 per cent on Friday due to the rebound in global indices and hopes of a stimulus package from the government. In line with the benchmark index, sectoral indices ended higher and the broader market, too, closed with modest gains. Friday’s surge could just be a recovery due to oversold positions and sustainability would be difficult at higher levels. The news flow on the spread of coronavirus continues to be mixed with exponential jump in new cases in US though there is improving trend in China. Thus, the volatility could persist in the near term.
According to Ajit Mishra, VP-research, Religare Broking, markets managed to gain nearly 6 per cent on Friday, thanks to the rebound in global indices and hopes of the stimulus package from the government. In line with the benchmark index, sectoral indices ended higher and the broader market too closed with modest gains. Friday’s surge could just be a recovery due to oversold positions and sustainability would be difficult at higher levels. “Needless to say, global cues and developments on the coronavirus front would dictate the market trend ahead also,” Mishra said.
ONGC was the top gainer, soaring 18.58 per cent, followed by UltraTech Cement (13.01 per cent), HUL (11.75 per cent), RIL (11.24 per cent), TCS (9.90 per cent), Tata Steel (9.60 per cent) and Asian Paints (8.91 per cent). The broader BSE midcap and smallcap indices surged up to 4.18 per cent. The general lockdown due to COVID-19 is expected to slow down the GDP growth further, analysts said.
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