Sensex gains by more than 300 points; HDFC twins shine

Having regard to US Fed's announcement about additional stimulus and taking cues from global indices, domestic markets were trading higher by about 800 points during the morning trading session. However, a sharp fall erasing all the gains was witnessed after tensions between India and China flared up as the Indian Army reported that an officer and two soldiers were killed in Galwan Valley in eastern Ladakh on Monday night during a violent face off with the Chinese troops. Later a recovery in Sensex by 651.92 points from the day’s low was seen as Sensex closed at 33,605.22 which is 376.42 points or 1.13 per cent higher than its previous close while Nifty gained by 100.30 points or 1.02 per cent to settle at 9,914.

US Federal Reserve launched its long-awaited Main Street lending program to help the economy to cope with the COVID-19 pandemic. The programme offers up to US$ 600 billion in loans via participating financial institutions to US businesses with up to 15,000 employees or with revenues up to US$ 5 billion. With an objective of supporting small and medium-sized businesses, it is targeted at companies previously in good shape before the pandemic, but now in need of financing. Accordingly, European indices such as FTSE 100, DAX and CAC 40 were seen trading in positive, soaring by 2.30 per cent, 2.72 per cent and 2.16 per cent respectively.

Despite the rise in new COVID-19 infections in Beijing, investors in Hong Kong remained positive that China will be able to tackle the situation once again and the following optimism led to Hang Seng gaining by 2.39 per cent. Since Bank of Japan left the key lending rate unchanged and maintained its yield curve control and quantitative easing program, further expecting the economy to positively recover from the ongoing slump, Japan's Nikkei index zoomed by 4.88 per cent. Other Asian indices such as Shanghai index and KOSPI rose by 1.44 per cent and 5.28 per cent respectively.

Sensex gainers consisted of HDFC Bank rallying by 4.16 per cent, HDFC up by 4.03 per cent, ICICI Bank gaining by 3.60 per cent, Kotak Mahindra increasing by 2.18 per cent, Infosys up by 1.99 per cent, etc.

Sensex losers comprised Tech Mahindra down by 2.75 per cent, Axis Bank declining by 2.03 per cent, IndusInd Bank dropping by 1.80 per cent, ITC decreasing by 1.20 per cent.

Amongst sectoral indices on BSE, Finance was the biggest gainer increasing by 2.32 per cent while Telecom was the biggest loser, down by 1.46 per cent. In the broader markets, both BSE small-cap index and BSE mid-cap index closed in green but by lower than 1 per cent.