Sensex surges 344 points in early trade; Nifty rises 108 points

The equity market opened on a strong note on Monday, with benchmark index Sensex jumping 344 points amid positive investor sentiments and mixed global cues.
| Photo Credit: Paul Noronha

The equity market opened on a strong note on Monday, with benchmark index Sensex jumping 344 points amid positive investor sentiments and mixed global cues.

The 30-share BSE Sensex surged 344.92 points or 0.58% to 59,480.05 points while the broader NSE Nifty climbed 108.05 points or 0.62% to 17,520.95 points. As many as 20 stocks in the Sensex pack were trading with gains.

The strong opening comes after two straight trading sessions of losses for the benchmark indices.

Notwithstanding concerns over the fallout of the collapse of the Silicon Valley Bank in the U.S., investor sentiments were relatively strong amid growth in industrial output in January and expectations that the U.S. Federal Reserve might opt for less aggressive rate hike approach.

India’s industrial output rose 5.2% in January, as per the official data released after market hours on Friday.

On Monday, most of the Asian markets were in the green while American and European markets closed in the negative territory on Friday as investor sentiments were hit by the Silicon Valley Bank crisis.

For the second consecutive trading session on Friday, Sensex closed in the red, tanking 671.15 points or 1.12% to 59,135.13 points. The Nifty too plunged 176.70 points or 1% to end the day at 17,412.90 points.

V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said the Silicon Valley Bank issue is unlikely to rattle the markets for long.

“A possible positive impact of the Silicon Valley Bank crisis is that it may nudge the U.S. Federal Reserve to go less hawkish since the aggressive rate hike by the Fed lies at the root of the SVB crisis.

“If the U.S. CPI inflation data tomorrow indicates a declining trend in inflation, the Fed is unlikely to raise rates by 50 bp in the March 22 meeting. That will be a positive from the market perspective,” he noted.

On Friday, Foreign Institutional Investors (FIIs) were net sellers as they offloaded shares worth ₹2,061.47 crore.

Deepak Jasani, Head of Retail Research at HDFC Securities, said U.S. stocks ended sharply lower Friday as investors parsed mixed signals from the February jobs report amid ongoing concerns about contagion in the banking sector from the troubles at the Silicon Valley Bank.