Benchmark indices ended higher for the second consecutive session boosted by banking stocks post HDFC-HDFC Bank merger news. The Sensex closed 1,335.05 points or 2.25 per cent higher at 60,611.74, and the Nifty shut shop 382.90 points or 2.17 per cent up at 18,053.40. The gains were courtesy a 10-per cent rally in HDFC Bank and 9-per cent in HDFC. Shareholders of HDFC Ltd will receive 42 shares of the bank for 25 shares held. Shares held by the housing finance company in the lender will be extinguished, making HDFC Bank a full-fledged public company. The transaction is expected to be completed in 18 months, subject to regulatory approvals.
Besides, Kotak Bank, HUL, IndusInd Bank, Tata Steel, L&T, and Sun Pharma were the other top gainers, up between 2 per cent and 3 per cent. On the flipside, Infosys and Titan Company were the only losers, down up to 1 per cent.
In the broader markets, the BSE MidCap and SmallCap indices 1.34 per cent and 1.7 per cent, respectively. In comparison, the headline indices ended 2.25 per cent up. Among sectors, the Nifty Financial Services index zoomed 4.5 per cent, followed by the Nifty Bank index, up 4 per cent. The Nifty IT index clocked the most tepid gains today, rising just 0.2 per cent.
S Ranganathan, Head of Research at LKP securities, said: “The mega-merger news of the HDFC Twins and the rare sight of a 15 per cent up-move in them today at a point in time propelled benchmark indices 2.5 per cent higher with good support from Metal stocks. The broader markets witnessed the continuation of the uptrend in Fertilizer stocks even as the Bank Nifty rose 4 per cent with private banks being sought after.”
Russia-Ukraine talks will continued to be in focus. As per reports, Ukrainian negotiator David Arakhamia has said that peace talks with Russia are at a stage that could lead to direct contact between Zelenskyy and Putin in Turkey.
This apart, key events are lined up this week starting with the manufacturing PMI data to be released today, followed by the FOMC March meeting minutes on Wednesday that investors will closely watch out for rate hike projections, inflation, and pace of US Fed balance sheet reduction.
On Friday, the RBI’s policy rate announcement remains most awaited. The central bank continues to be in a conflicting position amid flaring inflation and fears of falling behind the curve.
Global Cues
US stocks rose modestly to kick off the second quarter on Friday, as the monthly jobs report indicated a strong labor market and is likely to keep the Federal Reserve on track to maintain its hawkish policy stance. The Dow Jones Industrial Average rose 101.13 points, or 0.29 per cent, to 34,779.48, the S&P 500 gained 4.65 points, or 0.10 per cent, to 4,535.06 and the Nasdaq Composite dropped 7.58 points, or 0.05 per cent, to 14,212.94.
Tokyo’s Nikkei index opened higher on Monday, tracking gains on Wall Street, but early trade was volatile as investors eyed developments in Ukraine and Covid-19 lockdowns in China. The benchmark Nikkei 225 index rose 0.28 per cent, or 78.49 points, to 27,744.47 in early trade, but later sank into negative territory. The broader Topix index added 0.27 per cent, or 5.18 points, to 1,949.45.
Hong Kong stocks opened on a strong note Monday morning as traders welcomed Beijing’s decision to remove a rule preventing US authorities from inspecting Chinese firms traded in New York, easing concerns they could be delisted. The Hang Seng Index rose 0.85 pe rcent, or 187.56 points, to 22,227.11. Mainland Chinese markets are closed for a holiday.
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