Markets log gains for 2nd day on fresh foreign fund inflows, buying in Reliance, ICICI Bank

Mumbai, Jun 5 (PTI) Benchmark equity indices Sensex and Nifty rallied for the second day on the trot on Thursday, driven by buying in blue-chip stocks ICICI Bank and Reliance Industries amid fresh foreign capital inflows.

Besides, expectations of another interest rate cut in the RBI policy on Friday supported market sentiment, traders said.

After gaining over 900 points in the session, the 30-share BSE Sensex succumbed to profit booking to close 443.79 points or 0.55 per cent lower at 81,442.04. During the day, it jumped 912.88 points or 1.12 per cent to 81,911.13.

As many as 2,257 stocks advanced while 1,725 declined and 147 remained unchanged on the BSE.

The NSE Nifty rose 130.70 points or 0.53 per cent to 24,750.90.

"Though profit-booking remains evident at higher levels, the benchmark indices are attempting to recover their momentum amid consolidation. With a weakening dollar index and volatile US bond yields, FIIs are turning net buyers again after the recent selloffs in anticipation of final trade negotiations.

"Despite global uncertainty, strong indicators of economic and corporate earnings growth are encouraging investors to adopt a buy-on-dip strategy. Moreover, markets are attentively awaiting upcoming central bank decisions, with a 25-bps rate cut anticipated from both the ECB and RBI," Vinod Nair, Head of Research, Geojit Investments Limited, said.

Eternal was the biggest gainer in the Sensex pack, jumping 4.50 per cent, followed by Power Grid, ICICI Bank, Reliance Industries, UltraTech Cement, Adani Ports, Sun Pharma, ITC and Hindustan Unilever were also among the winners.

In contrast, IndusInd Bank, Axis Bank, Bajaj Finserv and Bajaj Finance were among the laggards.

"Markets witnessed volatility on the weekly expiry day but managed to close in the green. A lack of strong cues from global markets led to a flat start for the Nifty, followed by a swift recovery in the first half. However, profit-taking in the latter half significantly trimmed the gains...," Ajit Mishra – SVP, Research, Religare Broking Ltd, said.

Foreign Institutional Investors (FIIs) turned buyers on Wednesday, as they bought equities worth Rs 1,076.18 crore, according to exchange data.

"Nifty ended higher for the second straight session...Positive global cues and expectations of another interest rate cut in the RBI policy on Friday boosted market sentiment.

"FIIs returned as net buyers on Wednesday after two consecutive days of selling, pumping in Rs 1,076 crore into Indian equities. Renewed foreign inflows provided added comfort to the markets," Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd, said.

The BSE smallcap gauge climbed 0.65 per cent and the midcap index rallied 0.39 per cent.

Among sectoral indices, realty jumped 1.79 per cent, services (1.09 per cent), healthcare (0.88 per cent), consumer discretionary (0.73 per cent), industrials (0.60 per cent), commodities (0.51 per cent) and financial services (0.43 per cent).

On the other hand, auto and oil & gas were the laggards.

In Asian markets, South Korea's Kospi, Shanghai's SSE Composite index and Hong Kong's Hang Seng settled in the positive territory while Japan's Nikkei 225 index ended lower.

European markets were trading higher in mid-session deals.

US markets ended on a mixed note on Wednesday.

The Reserve Bank's rate-setting panel started its three-day brainstorming on monetary policy as expectations are high of a 25 bps or even a jumbo 50 bps rate cut to fuel economic growth amid uncertainties created by Trump's tariff moves.

The decision of the Monetary Policy Committee (MPC), headed by Reserve Bank Governor Sanjay Malhotra, will be announced on Friday.

Global oil benchmark Brent crude climbed 0.35 per cent to USD 65.14 a barrel.

On Wednesday, the 30-share BSE Sensex climbed 260.74 points or 0.32 per cent to settle at 80,998.25. The Nifty went up 77.70 points or 0.32 per cent to 24,620.20. PTI SUM SUM BAL BAL

Source: PTI