At 11:26 IST, the barometer index, the S&P BSE Sensex, surged 540.73 points or 1.36% at 40,419.63. The Nifty 50 index rallied 148.1 points or 1.26% at 11,887.05. Indices may witness a bout of volatility on account of weekly index options expiry.
The broader market lagged the main stock indices. The S&P BSE Mid-Cap index was up 0.67% while the S&P BSE Small-Cap index rose 0.53%.
The market breadth was positive. On the BSE, 1295 shares rose and 1035 shares fell. A total of 135 shares were unchanged.
COVID-19 Update:
India reported 902,425 active cases of COVID-19 infection and 105,526 deaths while 5,827,704 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India. Total COVID-19 confirmed cases worldwide stood at 36,077,017 with 1,054,674 deaths.
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The Nifty IT index jumped 4.38% to 21,938.75. The index has surged 15.63% in nine days.
Larsen & Toubro Infotech (up 9.77%), MindTree (up 8.2%), Mphasis (up 6.99%), HCL Tech (up 4.38%), Coforge (up 4%) and Tech Mahindra (up 3.49%) were top gainers in IT segment.
Infosys gained 3.81% after the IT major announced that it has signed a definitive agreement to acquire Blue Acorn iCi, Adobe Platinum partner in the US for a total consideration of $125 million. Infosys said the acquisition strengthens end-to-end customer experience offerings and demonstrates its continued commitment to help clients navigate their digital transformation journey.
Wipro jumped 4.71% to Rs 351.05 after the IT major said its board will consider a share buyback on 13 October 2020. "The outcome of the board meeting will be communicated to the stock exchanges soon after conclusion of the board meeting on October 13, 2020," Wipro said in a statement after market hours yesterday, 7 October 2020. The firm will also announce its Q2 results on 13 October 2020 after stock market trading hours in India.
TCS jumped 5% after the company reported good sequential numbers in the second quarter and announced a share buyback worth Rs 16,000 crore. The consolidated net profit grew 6.6% and revenue increased 4.73% in Q2 September 2020 (Q2FY21) over Q1 June 2020 (Q1FY21).
TCS said that constant currency revenue for Q2FY21 rose 4.8% quarter-on-quarter. The IT major's operating margin stood at 26.2% in Q2FY21 from 23.6% in Q1FY21. The deal wins stood at $8.6 billion in Q2FY21, against $6.9 billion in Q1FY21. BFSI (+6.2%), Retail and CPG (+8.8%) and life sciences and healthcare (+6.9%) led the growth. Technology & services grew 3.1%, manufacturing +1.4% while communications & media de-grew by 2.4%.
Meanwhile, the IT major's board approved a proposal to buyback up to 5.33 crore equity shares of the company for an aggregate amount not exceeding Rs 16,000 crore, being 1.42% of the total paid-up equity share capital, at Rs 3,000 per equity share. The board also declared an interim dividend of Rs 12 per equity share. The record date is set on 15 October 2020.
Global Markets:
Select Asian markets were trading higher on Thursday following an overnight surge on Wall Street. Investors likely continued watching for developments on US stimulus support, after President Donald Trump tweeted support for aid to airlines and other stimulus measures.
In US, stocks rose sharply on Wednesday after President Donald Trump tweeted support for aid to airlines and other stimulus measures, stoking hope that a smaller aid package could be passed by lawmakers. Meanwhile, on the virus treatment front, Eli Lilly said it's seeking clearance from the U.S. Food and Drug Administration for emergency authorization of its Covid-19 antibody treatment.
In a series of tweets Tuesday night, Trump urged Congress to approve airline payroll support, saying that money and aid for small business could be paid for with unused funds from the previous stimulus. Trump also pushed for another round of $1,200 stimulus checks for Americans.
The Federal Reserve could ramp up its bond purchasing program to push down further on borrowing costs, but for now the U.S. economy's most pressing need is for a new round of government spending, U.S. central bankers said on Wednesday.
Many members of the Federal Open Market Committee said their economic outlook assumed additional fiscal support, according to U.S. Federal Reserve minutes released on Wednesday. Central bank officials believe if aid packages are too small or too late, the economy is in for a weak recovery.
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