Business

Indices soar on U.S.-China trade deal

U.K. poll results also have positive effect; Axis Bank, SBI, Vedanta top gainers

Tracking strong gains in the global markets, Indian benchmark indices rose significantly on Friday with the benchmark Sensex closing above the 41,000-mark for the first time since November 28. The broader Nifty also managed to close above the psychological 12,000 mark.

The 30-share Sensex gained 428 points, or 1.05%, to close at 41,009.71 as auto, metal and banking stocks were in the limelight. The top gainers in the index pack were Axis Bank, Vedanta, State Bank of India, Maruti Suzuki India, IndusInd Bank, Yes Bank and Tata Steel, among others.

The Nifty surged 114.90 points, or 0.96%, to close at 12,086.70. The broader index last closed above the 12,000-mark on December 5. “The good news from foreign shores pushed the benchmarks higher despite weak macroeconomic data,” said Ajit Mishra, vice president, research, Religare Broking.

“The news report on a possible trade deal between the U.S. and China and exit polls showing a comfortable win for Boris Johnson in the U.K. elections triggered gap-up start in the Nifty.

“However, we are still seeing participation restricted largely to the handful of the index majors. We thus advise keeping caution in stock selection and preferring index majors over the others,” he added. Reports suggested U.S. and China have arrived at a consensus on the first phase of their trade talks. “Getting very close to a big deal with China. They want it, and so do we!,” tweeted U.S. President Donald Trump.

Other Asian indices

The effect was clearly visible across markets with Hang Seng gaining nearly 700 points while Nikkei was up almost 600 points. The benchmarks of most Asian markets ended with strong gains on Friday.

Back in India, the broad rally saw more than 1,500 stocks gaining ground on the BSE, as against 985 declines.

All the broader indices ended in positive territory on Friday.

Interestingly, foreign portfolio investors (FPIs) were net buyers at a paltry ₹116 crore even as their domestic counterparts bought shares worth ₹385 crore.

Meanwhile, shares of Ujjivan Small Finance Bank lost nearly 7% on Friday to close at ₹52.05.

The bank made a strong debut on the bourses on Thursday with its shares surging more than 70% to touch a high of ₹62.80 compared with its issue price of ₹37 apiece.

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Printable version | Feb 18, 2020 12:25:40 PM | https://www.thehindu.com/business/indices-soar-on-us-china-trade-deal/article30300307.ece

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