Sensex, Nifty rise for 2nd day

Indian equity benchmarks extended their gains for a second straight day on Monday buoyed by boosted investor sentiment following the Maharashtra and Jharkhand Assembly election results. Markets opened with a gap-up and traded higher throughout the day as traders took encouragement with report that the Trade and Economic Partnership Agreement (TEPA), signed in March 2024 between India and the European Free Trade Association (EFTA) countries, is poised to unlock new opportunities for Indian exports and drive investments worth $100 billion. Some support also came as Union Minister of State (Independent Charge) for Science and Technology; Earth Sciences and Minister of State for PMO, Department of Atomic Energy, Department of Space, Personnel, Public Grievances and Pensions, Jitendra Singh stated that from being led, India is today in a position to lead others across the world and this is amply borne out by recent success stories accomplished under PM Narendra Modi including Space sector headway, Biotechnology Vaccine breakthroughs and CSIR Purple Revolution.

However, markets trimmed some of their gains in late afternoon deals, as global geopolitical uncertainty, coupled with the continued selling by foreign investors weighted on investors' sentiment. Foreign portfolio investors (FPIs) are on course to turn net sellers in Indian stock markets for the second straight month through November, after having remained net buyers four months on a trot until September. So far in November, FPIs have sold stocks worth Rs 26,533 crore in India. Some cautiousness also came as the latest data released by the Reserve Bank of India (RBI) showed that India’s foreign exchange (forex) reserves declined $17.76 billion, the sharpest weekly fall, to hit a four-month low of $657.8 billion for the week ended November 15. But, markets ended higher with gains of over one percent each helped by a surge in Industrials, Capital Goods and Oil & Gas stocks. 

On the global front, European markets were trading higher as rate cut hope fueled gains after ECB chief economist Phillip Lane said that monetary policy should not remain restrictive for too long and that the job is not done yet on inflation. Asian markets settled mostly higher on Monday following the broadly positive cues from Wall Street, boosted by strong gains in markets in Japan, Indonesia and South Korea as traders remained optimistic about a 25-basis point rate cut by the US Fed in December after data showing consumer sentiment in the U.S. improved less than expected in November.

Finally, the BSE Sensex rose 992.74 points or 1.25% to 80,109.85, and the CNX Nifty was up by 314.65 points or 1.32% to 24,221.90.      

The BSE Sensex touched high and low of 80,473.08 and 79,765.99 respectively. There were 24 stocks advancing against 6 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 1.61%, while Small cap index was up by 1.86%.

The top gaining sectoral indices on the BSE were Industrials up by 3.29%, Capital Goods up by 3.27%, Oil & Gas up by 3.26%, PSU up by 2.96% and Energy up by 2.56%, while there were no losing sectoral indices on the BSE.

The top gainers on the Sensex were Larsen & Toubro up by 4.13%, SBI up by 3.52%, Adani Ports & SEZ up by 2.55%, HDFC Bank up by 2.21% and ICICI Bank up by 1.82%. On the flip side, JSW Steel down by 2.40%, Tech Mahindra down by 0.79%, Asian Paints down by 0.74%, Infosys down by 0.73% and Maruti Suzuki down by 0.49% were the top losers.

Meanwhile, indicating high interest rate and lower fiscal impulse tempering urban demand, S&P Global Ratings has revised down its estimate for India's economic growth in the next two financial years. In an update to its economic forecast for Asia-Pacific economies after US election results, the rating agency projected a 6.7 per cent Gross Domestic Product (GDP) growth rate in 2025-26 financial year (April 2025 to March 2026) and 6.8 per cent in the following fiscal year, down from 6.9 per cent and 7 per cent, respectively in previous projections. For FY25, S&P Global pegged GDP growth rate at 6.8 per cent. It expects India's GDP to grow at 7 per cent in FY28.

It said ‘In India we see GDP growth easing to 6.8 per cent this fiscal year as high interest rates and a lower fiscal impulse temper urban demand. While purchasing manager indices (PMIs) remain convincingly in the expansion zone, other high-frequency indicators indicate some transitory softening of growth momentum due to the hit to the construction sector in the September quarter’.

Besides, S&P retained its growth projection for China at 4.8 per cent in 2024 but cut next year's forecast to 4.1 per cent from 4.3 per cent earlier and to 3.8 per cent in 2026 from the previous estimate of 4.5 per cent. It noted that the impending change in the US administration will be challenging for China and the rest of Asia-Pacific. It also said the Asia-Pacific growth will be impeded by slower global demand and US trade policy. But lower interest rates and inflation should ease their drag on spending power.

The CNX Nifty traded in a range of 24,351.55 and 24,135.45. There were 43 stocks advancing against 7 stocks declining on the index.

The top gainers on Nifty were ONGC up by 5.48%, Bharat Electronics up by 4.33%, Larsen & Toubro up by 4.26%, BPCL up by 4.01% and Shriram Finance up by 3.78%. On the flip side, JSW Steel down by 2.32%, Tech Mahindra down by 0.71%, Infosys down by 0.59%, Maruti Suzuki down by 0.55% and Bajaj Auto down by 0.39% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 14.84 points or 0.18% to 8,276.92, France’s CAC rose 16.88 points or 0.23% to 7,271.89 and Germany’s DAX gained 79.09 points or 0.41% to 19,401.68.

Asian markets settled mostly higher on Monday tracking Wall Street gains last Friday and both the dollar and bond yields showed weakness after US President-elect Donald Trump has chosen wealthy hedge fund manager Scott Bessent to be his Treasury secretary. Japanese shares gained ahead of November inflation numbers from the capital city of Tokyo, due to be released later in the week. Seoul shares rose led by technology and battery shares, and ahead of Bank of Korea's interest-rate decision on Wednesday. However, Chinese shares declined ahead the release of NBS PMI data this week, which could impact business conditions amid recent stimulus and tariff concerns. Market sentiments weakened further as Chinese central bank PBoC kept a key policy rate unchanged in November and drained billions in liquidity from the financial system via a medium-term liquidity management tool.