scorecardresearchMarket Wrap: Sensex, Nifty jump 3%, clock weekly gain after 5 weeks of

Market Wrap: Sensex, Nifty jump 3%, clock weekly gain after 5 weeks of losses

Updated: 20 May 2022, 04:26 PM IST
TL;DR.

  • Sensex vaulted 1604 points in intraday trade before settling with a strong gain of 1534 points, or 2.91 percent, at 54,326.39, with all components in the green. Nifty50 ended the day at 16,266.15, up 457 points or 2.89 percent.

For the week ended May 20, Sensex and Nifty jumped 3 percent each. BSE Midcap index also jumped 3 percent while the smallcap index jumped 4 percent this week. (PTI Photo/Kunal Patil) 

For the week ended May 20, Sensex and Nifty jumped 3 percent each. BSE Midcap index also jumped 3 percent while the smallcap index jumped 4 percent this week. (PTI Photo/Kunal Patil) 

While worries over soaring inflation, aggressive rate hikes, slowing growth and geopolitical tensions persisted, the market clocked strong gains on May 20 as investors cheered China's move of cutting a key lending rate to support its economy.

As reported by Reuters, "China cut its five-year loan prime rate (LPR) - which influences the pricing of mortgages - by 15 basis points on Friday morning, a sharper reduction than expected, as authorities seek to cushion the impact of an economic slowdown."

Sensex vaulted 1604 points in intraday trade before settling with a strong gain of 1534 points, or 2.91 percent, at 54,326.39, with all components in the green. Nifty50 ended the day at 16,266.15, up 457 points or 2.89 percent.

BSE Midcap and smallcap indices ended 1.98 percent and 2.13 percent higher respectively.

"The market displayed a confident yet calm rally throughout the day, supported by fortified global markets, especially the Asian market. The Chinese Central bank cut a key interest rate to support growth, injecting optimism into emerging markets," Vinod Nair, Head of Research at Geojit Financial Services, pointed out.

Shares of Dr Reddy's Labs (up 8.10 percent) ended as the top gainer among the Sensex stocks, followed by Reliance Industries (up 5.77 percent), Nestle (up 4.74 percent), Tata Steel (up 4.22 percent) and Larsen & Toubro (up 4.01 percent).

Among the sectoral indices, BSE Realty jumped more than 4 percent while metal, capital goods, industrials and healthcare jumped more than 3 percent each.

Crude oil benchmark Brent Crude traded above the $110 a barrel mark while the rupee ended 18 paise higher at 77.55 per dollar.

The domestic equity market witnessed strong bouts of volatility this week as the market benchmarks the Sensex and the Nifty witnessed wild swings both ways during the week.

However, strong gains on May 17 and May 20 helped the benchmarks end the week on a strong note. Wit this, the market benchmarks ended their 5-week losing streak.

For the week ended May 20, Sensex and Nifty jumped 3 percent each. BSE Midcap index also jumped 3 percent while the smallcap index jumped 4 percent this week.

The overall market capitalisation of BSE-listed firms jumped to 254.1 lakh crore from 241.3 lakh crore on May 13, making investors richer by 12.8 lakh crore in a week.

"After witnessing a sharp decline over the past two weeks, the equity markets ended this week on a positive note. However, following global cues, the Indian equity markets remained volatile. FIIs continued their selling in India. Markets remained wary of global growth-inflation expectations. With the result-season coming towards the last leg, the focus will be more on the macro data points. Monetary policy tightening action by central banks globally amid high inflation will continue to weigh on market sentiments,” said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities.

"With concerns over an economic slowdown and rate hikes across the globe, investors will continue to invest with caution. Value stocks should do well during this consolidation period," said Nair.

Disclaimer: The views and recommendations made above are those of individual analysts and not of MintGenie.

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First Published: 20 May 2022, 04:26 PM IST