Indices reach 4-month high on Covid-19 vaccine hopes; Sensex up 429 points

The benchmark indices ended at a near four-month high on Thursday as positive developments in early-stage coronavirus vaccine trial soothed worries over rising number of cases at home. The rupee, too, rose against the US dollar.

The NSE Nifty50 index ended 1.17 per cent higher at 10,552, while the S&P BSE Sensex jumped 1.21 per cent, or 429 points, to 35,843.7, the best closing levels for the indices since March 6. The rupee ended at 75.01 against the dollar, its best closing since March 27.
 

Global markets, too, were upbeat after a Covid-19 vaccine from Pfizer and BioNTech was found to be well tolerated in early-stage human trials.

Experts said the markets also cheered signs of recovery in jobs and manufacturing after the economy reopened in June after a prolonged lockdown. The unemployment rate fell to 11 per cent in June, from 23.5 per cent in the previous two months, the data showed. 

 

A report signalled the rebound in the manufacturing purchasing managers’ index (PMI) for June was the steepest among major emerging markets. “The Indian markets traded in sync with global peers, following news of encouraging trials of a vaccine,” said Vinod Nair, head of research, Geojit Financial Services.

Among BSE’s sectoral indices, the BSE Auto index posted 2.83 per cent, most in nearly three weeks. Mahindra & Mahindra was the biggest percentage gainer on the Nifty, closing 6.1 per cent firmer at its best close since mid-February. Two-wheeler maker Hero MotoCorp gained 4.9 per cent to its highest in nearly eight months.

Technology stocks also posted sharp gains, with HCL Technologies, Infosys, and TCS gaining more than 3 per cent each. Experts said IT stocks gained ground, following reports that US Democratic presidential candidate Joe Biden will lift the temporary suspension of H1B visas, used by Indian IT professionals if he wins the November elections.

Technical analysts said the Nifty has crossed key levels which will help it post further gains. “On the weekly expiry day, the stock market closed above the crucial level of 10,550,” said Shrikant Chouhan, executive vice-president, equity technical research, Kotak Securities. “On the higher side, the Nifty has the scope to move up to 10,750 with a minor hurdle at 10,680.”

With inputs from Reuters