LGT Wealth India

THE BENCHMARK equity indices jumped over 1 per cent on Monday as investor sentiments turned positive after strong jobs data in the US moderated the fear of recession in the world’s largest economy.

Sensex, Nifty jump over 1% as global investors’ sentiments improve

The Indian Express Print, 8th May 2023

The benchmark equity indices jumped over 1 per cent on Monday as investor sentiments turned positive after strong jobs data in the US moderated the fear of recession in the world’s largest economy.

Banks, financial, and auto stocks helped the market to rebound. Consistent buying from foreign institutional investors (FIIs) also supported the rally.

The 30-stock BSE Sensex climbed 1.16 per, or 710 points, to end at 61,764.25. During the intraday trade, the index jumped almost 800 points. The broader Nifty surged 1.08 per cent, or 195.4 points, to finish at 18,264.4.

The data released on May 5 showed that the total non-farm payroll employment in the US rose by 253,000 in April from 185,000 in March. Even the US unemployment rate edged to 3.4 per cent in April from 3.5 per cent in March, which builds up the case of a prolonged pause by the US Federal Reserve instead of a rate cut, Bank of Baroda said in its research note.

“Cues from the mother market US indicate that the fears from the regional banking crisis are receding. The April US jobs data, which came at a much better-than-expected 2,53,000 jobs, reflect a strong economy which may even avoid a recession,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

Almost all sectors ended in green on Monday, with realty, auto, financial services, and banking being top gainers. Continued earnings momentum in banking stocks and sustained credit growth at 15.9 per cent led to a rally in Nifty Bank, said Siddhartha Khemka, Head (retail research), Motilal Oswal Financial Services Ltd.

Bank Nifty rose 1.46 per cent to close at 43,284.

Top gainers on Nifty 50 were IndusInd Bank, Tata Motors, Bajaj Finance, Bajaj Finserv and ONGC, rising 2-5 per cent. Coal India, Adani Enterprises, Sun Pharma, Dr Reddy’s Laboratories and Britannia ended in the red.

HDFC Ltd and HDFC Bank, which witnessed a massive sell-off on May 5, rose 1.21 per cent and 1.3 per cent, respectively, on NSE. Analysts said the market would take further cues from the economic data, such as inflation data in India, the US and China, to be released later this week.

FIIs have cumulatively bought Rs 10,850 crore of equity so far in May, the Central Depository Services Ltd (CDSL) data showed.