Effect of decreasing inflation seen, Sensex & Nifty rise; Rupee also strengthened

The benchmark indices Sensex and Nifty rose on Tuesday after four days of sharp decline due to reduction in retail inflation and surge in global markets. The 30-share BSE benchmark Sensex closed 169.62 points or 0.22 per cent higher at 76,499.63. During the day, it rose 505.6 points or 0.66 per cent to 76,835.61. The NSE Nifty rose 90.10 points, or 0.39 per cent, to 23,176.05.

However, stocks like NTPC Tata Steel Bajaj Finserv Zomato Bajaj Finance Tata Motors State Bank of India IndusInd Bank and Maruti showed a strong jump. Hindustan Unilever Titan Tata Consultancy Services Infosys and UltraTech Cement declined in the 30-share pack.

NSE Nifty rose 90.10 points

Traders said persistent selling by foreign investors and rising global crude oil prices put pressure on the indices and limited the gains. The BSE Sensex has fallen 1,869.1 points, or 2.39 per cent, in the last four trading sessions. In the 30-share blue-chip pack, Adani Ports jumped over 5 per cent.

While stocks of Titan, Tata Consultancy Services, Infosys and UltraTech Cement declined. HCL Technologies declined over 8 per cent after it reported disappointing December quarter results.

At the same time, according to government data released on Monday, retail inflation fell to a four-month low of 5.22 percent in December, mainly due to the reduction in prices of food items including vegetables. This has given the Reserve Bank the scope to cut the key interest rate in the upcoming monetary policy review.

Opinion of market expert

One of the market experts said, that this may give some relief to the RBI in its next policy meeting. However, rising oil prices will be closely monitored. Now the mood of investors will be decided around the quarterly results and the budget. While markets in Europe were trading in the green. US markets closed with a mixed trend on Monday. All Adani Group stocks were in strong demand, with Adani Power gaining nearly 20 per cent.

Also Read: Rupee fell 23 paise against dollar, lowest level ever; Stock market crashed

Markets in Europe were trading in the green

Although as by exchange data, foreign institutional investors (FIIs) sold shares worth Rs 4,892.84 crore on Monday. Global oil benchmark Brent crude rose 0.12 per cent to $81.11 per barrel. Government data released on Tuesday showed that wholesale price inflation rose to 2.37 per cent in December 2024 due to a jump in prices of non-food items, manufactured goods as well as fuel and power, though food items witnessed a marginal decline.

Rupee also strengthened

The rupee recovered from its all-time low and closed 8 paise higher at 86.62 (provisional) against the US dollar on Tuesday. The rupee gained 8 paise to close at 86.62 (provisional) against the US dollar after the release of macroeconomic numbers. Some recovery in domestic equity markets later supported the Indian currency. However, it remained under pressure due to high crude oil prices and continued foreign fund outflows.

In the meanwhile, the interbank foreign exchange Indian rupee opened at 86.57 and touched an intra-day high of 86.45 and ended the day at 86.62 (provisional), registering a gain of 8 paise. On Monday, the rupee recorded its biggest single-day fall in nearly two years.

Summary

It ended the session 66 paise lower at its historic low of 86.70 against the US dollar. Earlier, the previous record biggest single day fall of 68 paise was witnessed on February 6, 2023.