Hopes of normal monsoon, healthy Q4 results push market higher
Bombay Stock ExchangeIANS (File photo)

Hopes of normal monsoon, healthy Q4 results push market higher

Mumbai, April 13, 2021

Predictions of a normal monsoon, along with short covering and hopes of healthy Q4FY21 results, triggered a rebound in India's benchmark equity indices from two-month lows on Tuesday.

Besides, reports of a fall in incremental Covid cases and higher recoveries stabilised sentiments.

This led a fall in India's Volatility Index by 11 per cent to end at 20.46.

Globally, stocks ticked up on Tuesday on the back of better outlook for the global economic recovery.

On the domestic front, updated forecasts released by Skymet on Tuesday suggested that Southwest Monsoon may be 103 per cent of the long-period average.

Among sectors, PSU banks, auto, metals, bank, realty and media gained the most while IT and pharma lost the most.

At the end of the day, Sensex closed at 48,544.06, higher by 660.68 points, or 1.38 per cent, from its previous close of 47,883.38.

The Nifty50 on the National Stock Exchange traded at 14,504.80, higher by 194 points, or 1.36 per cent, from its previous close.

"Nifty respected the double bottom of 14,264 made on April 12 and bounced back smartly," said Deepak Jasani, Head of Retail Research at HDFC Securities.

"On upmoves, Nifty could face resistance from 14,652-14,683 band while 14,449 and later 14,264 remains a support.

Siddhartha Khemka, Head of Retail Research, Motilal Oswal Financial Services, said: "Global cues were positive post strong export data of China and ahead of US inflation data. On the domestic side, the Nifty opened flat to positive and remained highly volatile in the first half, but witnessed sharp pullback in the second half. Investors cheered the government's proposal to fast-track approvals for Covid vaccines made by foreign producers and approved by global health agencies."

"Further the prediction of normal to above normal rainfall and marginally lower Covid cases also provided support to the market. This is the third year in succession that India may see 'above normal' rains during the season."

Geojit Financial Services' Research Head Vinod Nair said: "Market attempted to pull back from yesterday's selloff but wasn't that enthusiastic. IT sector broke the trend due to profit booking as initial Q4 results were in line with expectations not providing enough leeway to a highly valued sector."

"While Industrial production for February declined by 3.6 per cent primarily due to contraction in the manufacturing and mining sectors. India's retail inflation for March also rose to 5.52 per cent, however, it did not harm the market sentiment as it was in line with the recent RBI policy forecast. How the lockdowns will affect the economy will determine the trend of the domestic market, in the short-term."

IANS

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