Sensex rises 1,000 points higher and Nifty closes over 16,900

The benchmark indices closed higher for the second day in a row on Thursday, with the Sensex rising 1,000 points and the Nifty closing above 16,900, thanks to encouraging signals from the global market following the US Federal Reserve’s policy decision, strong earnings in the large cap sector, and partial short-covering and partial investment buying in some sectors.

At the closing, the Nifty 50 was up 287.80 points, or 1.73 percent, and the Sensex was up 1,041.47 points, or 1.87 percent, at 16,929.60. 1,904 shares have increased, 1,427 shares have decreased, and 148 shares have remained unchanged. Major gainers on the Nifty were Bajaj Finance (NS: BJFN), Bajaj Finserve, Kotak Mahindra Bank (NS: KTKM), and IndusInd Bank (NS: INBK).

“Positive cues from global markets following the Fed policy outcome, as well as domestic large caps’ upbeat earnings, drove the market rally. The Fed’s decision was as expected, while their positive comment dismissing the possibility of a recession and hinting at a slower pace of rate hikes in the coming months boosted global sentiments,” said Vinod Nair, Head of Research at Geojit Financial Services.

Mid cap and small cap stocks both had solid finishes, rising 0.84 percent and 0.85 percent, respectively, on the Nifty mid cap and small cap. On the National Stock Exchange, Nifty IT and Financials did better than average.

Aside from this, positive reactions to the Fed’s decision and hints of a slower rate hike pace in the near future helped Asian and European stocks rise on Thursday. All Asian markets closed higher, as did Tokyo stocks.

Interest rates were increased by 75 basis points by Federal Reserve officials on Wednesday. Talking on the recession, Fed Chair Jerome Powell said: “I don’t think the US is currently in a recession and the reason is there are too many areas of the economy are performing well.”

“The market is taking cues from the Fed chief’s statement that ‘I don’t think we are in a recession now, the labour market continues to be tight’. Data – unemployment at 50-year lows and job vacancies at historical highs – supports the Fed chief’s view. In brief, the market is responding to the possibility of a soft landing for the US and the global economy,” said Dr. V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services.