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Wednesday, May 27, 2020

Sensex zooms 986 points on RBI move, rate sensitive stocks rally

Rebounding from an all-time low hit a day earlier, the rupee settled 48 paise higher at 76.39 against the US dollar aided by the RBI measures and a strong rally in domestic equities.

Published: April 18, 2020 1:50:26 am
India coronavirus, Indian economy coronavirus, Sensex Nifty BSE coronavirus, Covid-19 India The BSE Sensex rose 986 points, or 3.22 per cent, to 31,588.72 and the Nifty50 gained 274 points to 9,266.75. (Express photo)

Buoyed by the Reserve Bank of India’s measures to prop up the economy reeling under the impact of Covid-19, the Sensex on Friday rallied 3.2 per cent on widespread buying support. The BSE Sensex rose 986 points, or 3.22 per cent, to 31,588.72 and the Nifty50 gained 274 points to 9,266.75.

Rebounding from an all-time low hit a day earlier, the rupee settled 48 paise higher at 76.39 against the US dollar aided by the RBI measures and a strong rally in domestic equities. The central bank slashed reverse repo rate by 25 basis points to 3.75 per cent and also announced a Rs 50,000 crore liquidity package for NBFCs.

S Ranganathan, head of research, LKP Securities, said, “The liquidity boosting measures announced by the RBI on the back of positive global cues boosted the markets today despite profit booking seen in the afternoon trade. Financials led the charge and several heavy weights joined the party as the day progressed in anticipation of a stimulus package.”

Rahul Sharma, research head, Equity99, said worries over the scale of economic fallout due to coronavirus pandemic which led the rupee to hit a fresh record low of 76.87 against the dollar remained the biggest concern.

Vinod Nair, Head of Research at Geojit Financial Services, said, “Markets were buoyant following the RBI measures to boost liquidity and reclassify NPA norms for commercial banks. The positive global markets also added to the buoyancy. Rate sensitive stocks managed to outperform.”

Meanwhile, the S&P 500 climbed close to 2 per cent in the first few minutes of trading, following up on 3 per cent jumps in Europe and rises of nearly as much in Asia.

Oil prices were mixed on Friday. Brent rose by 41 cents, or 1.5 per cent, to $28.23 a barrel by 1347 GMT.

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