Market Wrap: Sensex, Nifty up in the green for second consecutive day; Fed meet outcome eyed

Equity benchmarks the Sensex and the Nifty ended in the green for the second consecutive day on March 22 amid positive global cues ahead of the Federal Reserve's policy meeting outcome.

Investors will seek cues on the path of rate hikes when inflation is sticky, growth is slowing and there is a banking crisis.

"Markets show a quarter-point rise in US rates is the most likely outcome, but investors will be keen to hear what Chair Jerome Powell says about the crisis that has rattled global banks this month and how carefully the central bank feels it needs to tread," reported Reuters.

Meanwhile, inflation in the UK rose to 10.4 percent in February from 10.1 percent in January, official data showed on March 22, a day before the Bank of England announces its latest interest rate decision.

A Reuters poll had forecast the annual CPI rate to drop to 9.9 percent in February. UK's inflation had surged to a 41-year high of 11.1 percent in October.

Amid persisting concerns over inflation, rate hikes, the banking crisis in the West and global economic slowdown, the Sensex and the Nifty extended gains into the second consecutive session.

Sensex closed with a gain of 140 points, or 0.24 percent, at 58,214.59 while the Nifty settled 44 points, or 0.26 percent, higher at 17,151.90.

Mid and smallcaps also ended in the green. The BSE Midcap index closed 0.18 percent higher while the Smallcap index clocked a gain of 0.54 percent.

Crude oil prices declined amid reports of an unexpected rise in the US crude inventories last week which indicates subdued demand for oil. Brent Crude traded near the $75 per barrel mark.

Top Nifty gainers: Shares of HDFC Life Insurance Company, Bajaj Finance and Bajaj Finserv ended as the top gainers in the Nifty index, rising up to 3 percent.

Top Nifty losers: Shares of BPCL, NTPC and Coal India ended as the top losers in the Nifty pack, falling up to 2 percent.

As many as 33 stocks ended in the green while 16 ended in the red and one stock - Infosys - ended flat in the Nifty index.

Pharma, healthcare lead the sectoral pack

Among the sectoral indices, Nifty Pharma and Healthcare indices rose over a percent each, emerging as the top gainers among the sectoral indices.

Nifty PSU Bank index rose 0.83 percent while the Nifty Bank ended 0.26 percent higher.

Nifty Media (down 0.32 percent), Consumer Durables (down 0.12 percent), Realty (down 0.10 percent) and Metal (down 0.04 percent) ended in the red.

Expert's views on markets

"Staying afloat in a volatile trade, the domestic market managed to remain positive, with the optimism that global banking system issue is behind us," said Vinod Nair, Head of Research at Geojit Financial Services.

"The volatility brought in from western markets ahead of the announcement of Fed policy and release of high UK inflation, tested market sentiments. The market has factored in a 25bps rate hike by Fed, and an in-line and less hawkish policy stance will attract bulls," said Nair.

Technical views on markets

Jatin Gedia, Technical Research Analyst, Sharekhan by BNP Paribas pointed out that on the daily charts, the Nifty is in a pullback mode after correcting around 1,000 points between March 9 to March 20.

"Today the daily momentum indicator triggered a fresh positive crossover which is a buy signal. Also, we believe that the pullback is not yet complete and we expect it to continue over the next few trading sessions," said Gedia.

"On the upside, we expect it to retrace till levels of 17,460 – 17,500 where resistance in the form of the 200-day moving average and also a gap are formed on March 10 is placed. On the downside, the immediate support stands at the lower end of the downward sloping channel 16,800 – 16,830," Gedia said.

Key market data

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of MintGenie.