Markets Cheer Fed’s ‘Status Quo’, Rupee At 61.85/USD

What a day for the markets! The Sensex has shot up 700 points and Nifty is higher by more than 200 points. Who would have thought that the indices may go up like this? In one sweep, the markets have slapped all the negatives that were in the picture for many months.

Among the indices that gained today, Bankex was the top gainer, up by nearly 7%. Realty was the second best performer, with over 5% gains. The IT, TECk and Healthcare indices, on the other hand, continue to underperform the market as rupee appreciation does not augur well for them.

Banking stocks were the frontline gainers today on hopes that the RBI may announce some easing in the new guidelines that it had issued a few weeks ago. YES Bank, which was the worst affected stock after the RBI’s recent announcements, added more than 23% to its market cap today. Indian Bank went up by 12%. Among the others, Union Bank, Oriental Bank and Punjab National Bank also gained more than 8% each.

Stocks related with real estate such as Indiabulls Real Estate, LIC Housing Finance, DLF, Unitech, etc. have also shown fantastic gains in today’s market.

From the power pack, GMR Infra, Reliance Infra and Tata Power have gained more than 5% each over the trading day.

Defensive sectors took a backseat today. In the Pharma sector, the shares of Aurobindo Pharma gained about 5%.

The Indian rupee too appreciated by more than 2.4% by day’s closing. With the slow by steady appreciation in the currency, it seems that the chances of a downgrade of the economy have waned slightly at this moment.

Now, all eyes are set on the RBI’s policy meet tomorrow. We are expecting the regulator to maintain status quo on the policy front.