Benchmarks overcome bouts of volatility to settle in green on Friday

Indian equity benchmarks overcame bouts of volatility to settle in the green for the second straight session on Friday, backed by renewed buying interest in Realty, Metal and Banking stocks. Besides, a strengthening rupee and lower crude prices in the international markets also influenced sentiments. Markets made a gap-up opening amid a firm trend in global equities. Traders took a note of rating agency Crisil’s statement that the India’s economy is likely to log in 6 per cent growth next fiscal, in line with consensus estimates, driven by an increased capex by the private sector. It added the private sector capex is expected to deliver double-digit revenue growth for the second year on the trot. The economy is projected to grow 7 per cent this fiscal. Crisil further said it expects the corporate revenue to log in double-digit rise again next fiscal.

However, markets reversed initial gains in afternoon deals amid volatility. Traders turned anxious amid reports that the RBI is likely to for one more rate hike in its next monetary policy committee meeting in April, as India’s headline inflation continues to be sticky at around 6 percent and the central bank also keeping its eye on the rupee stability along with uncertainty in the US markets and Fed impending decision. Traders took a note of repot that Chief Economic Advisor V Anantha Nageswaran has said the global uncertainty has been rising after the recent developments in the United States and governments, businesses and individuals should keep 'margins of safety' in fiscal, corporate and savings account planning. Besides, foreign institutional investors (FII) net sold shares worth Rs 282.06 crore on March 17, according to the provisional data available on the NSE. But, in the late afternoon deals, markets regained traction to close with handsome gains as positive cues from European markets lent some support to markets.  

On the global front, European markets were trading higher as multi-billion-dollar lifelines for troubled U.S. and European banks helped calm investor fears around potential contagion. Asian markets settled higher on Friday as worries about a crisis in the U.S. and European banking sector eased and investors looked forward to a smaller rate hike from the Federal Reserve next week. Credit Suisse Group received a liquidity lifeline from the Swiss National Bank and big U.S. banks put together rescue effort for First Republic Bank, easing worries over a possible spreading of risks throughout financial system.

Back home, thermal power industry stocks were in watch with report that thermal power plants monitored by the Central Electricity Authority (CEA) had 33.5 million tonne of coal stock as on Sunday, which was sufficient to run them for 12 days at 85 per cent capacity utilization. Stocks related to pharma sector also were in watch as rating agency ICRA in its latest report has said that domestic pharmaceutical industry is expected to witness a revenue growth of 6-8 per cent in the next fiscal (FY24).

Finally, the BSE Sensex rose 355.06 points or 0.62% to 57,989.90 and the CNX Nifty was up by 114.45 points or 0.67% to 17,100.05.

The BSE Sensex touched high and low of 58,178.94 and 57,503.90, respectively. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 0.29%, while Small cap index was up by 0.69%.

The top gaining sectoral indices on the BSE were Realty up by 3.16%, Metal up by 2.42%, Bankex up by 1.22%, IT up by 1.10% and Industrials up by 1.01%, while Auto down by 0.51%, Healthcare down by 0.41% and FMCG down by 0.28% were the few losing indices on BSE.

The top gainers on the Sensex were HCL Technologies up by 3.37%, Ultratech Cement up by 2.53%, Nestle up by 2.21%, Tata Steel up by 1.90% and Kotak Mahindra Bank up by 1.63%. On the flip side, ITC down by 1.51%, Maruti Suzuki down by 1.48%, NTPC down by 1.25%, Asian Paints down by 1.14% and Sun Pharma down by 0.99% were the top losers.

Meanwhile, Chief Economic Advisor V Anantha Nageswaran has said the global uncertainty has been rising after the recent developments in the United States and governments, businesses and individuals should keep 'margins of safety' in fiscal, corporate and savings account planning. Nageswaran said the global growth estimates of the International Monetary Fund (IMF) given in January looks outdated and countries will have to watch what the developments in the US over the last week would do to confidence, bank. Two banks in America have gone belly up over the last week.

Signature Bank, New York, which lent mostly to crypto industry was shut down by the regulators after there was a run on their deposits. Besides, the failure of Silicon Valley Bank (SVB) last week left many startups, tech companies, entrepreneurs and VC funds nervous and jittery. SVB, the 16th largest bank in the United States, was closed on Friday last by the California Department of Financial Protection and Innovation which later appointed the FDIC as its receiver.

He said uncertainty has been on a rising trend and has gone up a few notches in the last week and this is something which countries need to live with, not only this year but for the next year and beyond. He stated ‘The important thing to remember is that when you are facing uncertain times, the key thing to do is to make sure that we have margins of safety in our operations, whether it is for corporates or for investors. The only guidance one can think of is to allow for margins of safety, whether it is in fiscal planning, corporate planning or household balance sheet or savings account planning.’

The CNX Nifty traded in a range of 17,145.80 and 16,958.15. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were HCL Technologies up by 3.68%, Hindalco up by 2.94%, Ultratech Cement up by 2.68%, UPL up by 2.53% and JSW Steel up by 2.34%. On the flip side, Eicher Motors down by 1.83%, NTPC down by 1.78%, Maruti Suzuki down by 1.51%, ITC down by 1.31% and Power Grid Corporation down by 1.18% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 35.5 points or 0.48% to 7,445.53, France’s CAC rose 0.14 points or 0% to 7,025.86 and Germany’s DAX gained 28.73 points or 0.19% to 14,995.83.

Asian markets settled higher on Friday tracking Wall Street’s strong gains overnight after reports that a group of US banking giants moved to shore up embattled First Republic Bank, that eased worries over a possible spreading of risks throughout financial system. Meanwhile, Investors are awaiting interest rate decisions from the US Federal Reserve. Chinese shares rose due to optimism over an economic recovery in the country. Moreover, Seoul shares gained as investors priced in a 25-bps hike at next week's Fed meeting.