Nifty and Sensex opened higher, fueled by financial and IT stocks

Markets Surge: Nifty and Sensex Rise with Boost from Financial and IT Sectors

Written by: Supriya Kadu

Edited by: Omkar Devadkar

Last Updated: August 20, 2024

Summary: As of 10:10 am, the NSE Nifty 50 index was up 0.53% at 24,702.65, while the S&P BSE Sensex rose 0.51% to 80,839.08.

Benchmark indices started higher on Tuesday, following advances in Asian markets and boosted by anticipation of a possible US Federal Reserve rate drop.

The information technology (IT) sector led the gains, as market confidence was buoyed by expectations of a future US Federal Reserve rate reduction.

The S&P BSE Sensex increased by 0.51 percent to 80,839.08 as of 10:10 am, while the NSE Nifty 50 index was up 0.53 percent to 24,702.65.

With IT stocks up 1.2%, the IT sector emerged as the best performer. The idea that the Federal Reserve may start cutting rates in September sparked higher rates in this industry, which depends mostly on US income. Analysts also cited recent data as evidence that the US economy would avoid going into recession as a reason for the IT sector's impressive performance. The Federal Reserve Chair's speech on Wednesday is expected to have an additional impact on IT equities.

The MSCI ex-Japan index rose 0.25 percent among other Asian markets, following a greater regional rise.

Positive momentum was also observed in the broader market. India's small-cap and mid-cap indices, which are centered on the country, both saw gains of about 0.2%.

Wright Research's founder and fund manager, Sonam Srivastava, stated, “While the benchmarks have experienced some time correction in August, the medium- to long-term outlook for Indian equities remains positive. This period offers investors a chance to rebalance portfolios and identify potential entry points.”

Primary stock highlights:

IndusInd Bank: Following the Reserve Bank of India's approval of the bank's establishment of a wholly-owned asset management business, shares of the bank increased by almost 2%. With gains of almost 0.75 percent, the company outperformed the Nifty 50 and the banking and financial indices.

Polycab India: Following the initiation of coverage with a "buy" recommendation by UBS, which cited long-term growth prospects from electrification, shares soared by almost 4%.

SeQuent Scientific: The company's shares shot up 7% following the World Health Organization's pre-qualification approval of a medication that treats parasitic illnesses, such as roundworms and tapeworms.

Nucleus Software: Ahead of a board meeting on Thursday to discuss a share buyback proposal, shares surged 18%.