Indian bourses bounced back as they entered the last week of November, with benchmark indices Sensex and Nifty opening in the green and staying buoyant through the morning session.
The Sensex climbed over 241 points to trade as high as 85,473.47 while the Nifty sailed to a 26,142.80 high, riding a wave of enthusiasm for IT shares.
Tech Mahindra saw its shares jump more than 3 per cent. Other IT stocks like Infosys, HCL Tech, and TCS were also major gainers on the Sensex.
The IT sector in India also benefited from the renewed optimism in the US tech sector globally and hopes for a US Federal Reserve rate cut in December.
Global cues remained supportive, with Wall Street hitting new highs Friday night and Asian markets mostly in positive territory on Monday. Lower-than-expected US inflation helped matters, and the New York Fed chief added fuel to the fire, hinting over the weekend that the US Fed could cut rates sooner than previously believed. Talk of the potential US-India trade deal progressing was the icing on top.
It was not just the IT sector that benefited. In the morning, 12 of 16 sectoral indices ended in the green, with banking stocks also lending support.
Small-cap and mid-cap indices, however, remained largely flat, as investors weighed frothy valuations and awaited fresh triggers.
Moreover, Bharat Electronics (BEL), Tata Motors Passenger Vehicles (TMPV), Trent, Powergrid, and Mahindra & Mahindra emerged as Sensex laggards on intense profit-booking.
Macro indicators were also looking more or less balanced. Brent crude oil eased slightly to around $62.50 per barrel. Meanwhile, the rupee showed signs of life, recovering from its record low of 89.49 per US dollar on Friday to appreciate to about 89.17 due to timely RBI intervention.
Despite FIIs offloading Indian holdings in the tune of Rs 1,766 crore on Friday, domestic institutional investors supported markets with Rs 3,161 crore in net purchases.
Now, all eyes are on India’s GDP data due Friday, and market watchers think that the mood remains constructive, given the solid earnings season recently, easing inflation, and hopes that export and tech sectors can keep the momentum going.