Sensex rallies 400 points, Nifty eyes 8,250; Tata Steel gains 4%

Benchmark indices continue to maintain the upbeat trend supported by strong global cues along with buying in Tata group and auto shares leading the rally. Besides, investors are bracing for the ECB's policy-setting meeting today.

By 12:25 am, the S&P BSE Sensex was up 399 points at 26,635 and the Nifty50 gained 124 points at 8,226.  The broader markets are performing in line with the benchmark indices- BSE Midcap and Smallcap indices are up over 1%.

“Traders will need to watch if the Nifty can hold above the immediate supports of 8,056; else a further correction is likely,” adds Subash Gangadharan - Technical/Derivative Analyst, HDFC Securities.

Asian shares hopped higher on Thursday after Wall Street strode to new records and bonds rallied on wagers the European Central Bank would extend its asset buying campaign at a policy meeting later in the session.

MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.8% to a one-month top, while Australia jumped 1.3% helped by rising resource prices.

Japan's Nikkei put on 1%, brushing off a disappointing downward revision to economic growth for the third quarter.

Back home, RBI’s monetary stance remained accommodative, but it warned inflation could rise again. Only two of 12 economists and bankers polled by Business Standard had said they expected RBI to hold interest rates and the bond market had factored in a cut of a quarter of a percentage point.

"This is a good tactical call as this will still leave a chance with RBI Governor to see how the global economy reacts to FED move and then take a call on domestic Interest rates. One of the reason of not reducing Interest rate could be possibility of FED increasing the rate in the next week's meeting," said Motilal Oswal, Chairman & MD, Motilal Oswal Financial Services.

He further adds, "Nifty is trading at such a level where down side risk is limited and street seems to have taken a change in economy in its stride. Nifty may not fall much from here and every knee jerk negative reaction should be used to add the equity allocation."

BUZZING STOCKS & CORPORATE NEWS

Tata Steel on Wednesday made a 10-year commitment to a one-billion-pound investment plan as part of its crucial talks with steelworkers’ unions to save thousands of jobs in the UK. The stock is up over 2%.

Wipro has said it will work with select start-ups in India that are associated with Microsoft Accelerator to help them scale their business and take them to customers globally. Shares of Wipro are up almost 1%.

State Bank of India Chairman Arundhati Bhattacharya on Wednesday asked that the Reserve Bank of India (RBI) seek a parliamentary nod to pay interest on the incremental cash reserve ratio (CRR) for the fortnight in which all lenders were asked to park excess funds with the central bank. SBI has surged over 1%.

Divi’s Laboratories has dipped 6% to Rs 1,091 on the BSE in early morning trade after the company said the US Food and Drug Administration (USFDA) has issued form 483 with five observations against its unit at Visakhapatnam of Andhra Pradesh.

Crompton Greaves has dipped 9% to Rs 60 on the BSE in early morning trade after the company said that its deal with Pauwels Spaco Ltd-an SPV of first reserve (parties) for sale of its power business in Europe, North America and Indonesia stands terminated.

Adani Transmission Limited (ATL) on Wednesday executed the share purchase agreement (SPA) with Reliance Infrastructure Limited (R-Infra) for 100% acquisition of the latter's Western Region System Strengthening Scheme's (WRSSS) transmission assets. The stock is up nearly 1%.

Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corp today signed a pact to build India's biggest oil refinery at a cost of $30 billion on the west coast. Shares of IOC, BPCL and HPCL are up almost 1% each.

With Reuters inputs

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