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Sensex gets a dose of optimism, up 258 points ahead of Fed meet


Mumbai :The benchmark BSE Sensex propelled by a rally in Chinese stocks and overnight gains in the US vaulted 258 points today to close at 25,963.97 — its highest close in over two weeks—ahead of the US Fed meeting.

The broader NSE Nifty took back the 7,900-mark during the session.

All eyes are now on the crucial two-day US Federal Reserve meeting starting today, where the rate-setters are going to take a call on raising the borrowing costs for the first time in almost a decade.

Sentiment remained upbeat as investors are hopeful that the Reserve Bank would cut rate for the fourth time this year at its policy review on September 29 after data showed retail inflation easing to 3.66 per cent in August, much below the RBI’s guidance level.

In line with domestic equities, the rupee also wiped off most of its early losses to trade almost flat at 66.36 (intra-day) against the dollar.

After opening in the positive zone, the 30-share Sensex barometer rose further to regain the 26,000-level and hit a high of 26,006.75 in afternoon trade.

But it failed to sustain momentum due to profit-booking at higher levels and slumped to 25,816.50, before settling higher by 258.04 points, or 1 per cent, at 25,963.97, its highest closing since August 31.

The gauge had retreated from a two-week high by losing 150.77 points in the previous trading session yesterday.

Also, the 50-issue NSE Nifty after reclaiming 7,900-level advanced to hit the day’s high of 7,913.90, before closing at 7,899.15, up 70.05 points, or 0.89 per cent.

Brokers said the investor appetite was back as participants widened their bets tracking a firm trend at other Asian bourses amid speculation of state-led buying, with Shanghai Composite index closing 4.89 per cent up.

The banking sectoral index advanced the most by surging 1.42 per cent, followed by power, healthcare, technology, auto and IT.

Bharti Airtel showed the way, up 2.48 per cent, to close at Rs 359.10.

Drug major Sun Pharma surged 2.38 per cent to Rs 887.35 after the company got into an agreement with InSite Vision to acquire the US-based eyecare firm.

Other prominent gainers were Axis Bank, Vedanta, Hero MotoCorp, Bajaj Auto and Wipro.

Overall, 26 out of the 30-share Sensex team rose.

However, BSE small-cap and mid-cap indices ended up to 0.44 per cent lower.

Meanwhile, foreign portfolio investors (FPIs) sold net Rs 910.85 crore worth of shares yesterday, according to provisional exchange data.

Stock exchanges will remain closed tomorrow on account of Ganesh Chaturthi.

Globally, the Shanghai Composite index closed 4.89 per cent higher and Hong Kong’s Hang Seng surged 2.38 per cent while Japan’s Nikkei ended 0.81 per cent higher.

European markets were also in the positive terrain in early trade ahead of the two-day US Federal Reserve policy meet.


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