Basic materials and Utility stocks gained the most, and their gauges rose 3 and 2.5 per cent, respectively. Bharti Airtel was the only losing Sensex stocks. The telecom major’s stock plunged 4.5 per cent ahead of spectrum auction.
Analysts said the pace of the movement of Treasury yields was more critical and that the markets
would be unperturbed as long as the rise in bond yields
were at historic lows, and it is expected to go up anyway. Fed and other central banks are not in a hurry to raise rates. As long as it goes up slowly, its impact will be bearable. Moreover, rising yields also signify that growth is picking up, and as long as both growth and yield go up simultaneously, there is no reason to worry," said Jyotivardhan Jaipuria, founder, Valentis Advisors.
On Saturday, the House of Representatives in the US approved the Biden administration's $1.9-trillion pandemic package. US President Biden urged the Senate to take quick action on the Bill after the House passed it. Analysts said expectations of stimulus measures would continue to provide a boost for equities.
India posted GDP growth of 0.4 per cent for Q3, on Friday. Though the GDP is expected to fall 8 per cent for the financial year, the December quarter GDP figures are seen as further strengthening the V-shaped recovery.
Market players said the Covid-19 vaccination drive also raised hopes of further improvement in GDP. The top US health body's unanimous vote to recommend Johnson & Johnson's shot for widespread use also boosted sentiment.
"The progress on the US stimulus package and stability in bond yields
triggered a rebound in early trade, followed by a range-bound movement until the end. Besides, participants also reacted to the GDP numbers, which showed marginal growth after seeing a contraction in the last two quarters," said Ajit Mishra, VP-research, Religare Broking.
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