Sensex, Nifty Stage Strong Comeback Amid Easing Inflation, Buying In Telecom Stocks

Mumbai: Benchmark indices Sensex and Nifty ended sharply higher on Friday amid heavy buying in telecommunication stocks and encouraging domestic inflation data.

After falling 1,207.14 points in morning trade, the 30-share BSE benchmark Sensex recovered all the lost ground later and jumped 843.16 points or 1.04 per cent to settle at 82,133.12. During the day, it surged 923.96 points or 1.13 per cent to 82,213.92.

The NSE Nifty climbed 219.60 points or 0.89 per cent to settle at 24,768.30 after falling 367.9 points in intra-day trade.

Among the 30-share Sensex blue-chip pack, Bharti Airtel, ITC, Kotak Mahindra Bank, Hindustan Unilever, Titan, UltraTech Cement, HCL Technologies, and Power Grid, were the biggest gainers.

Tata Steel, IndusInd Bank, JSW Steel and Bajaj Finserv were the laggards.

Retail inflation declined in November to 5.48 per cent and came within the Reserve Bank's comfort zone mainly due to easing food prices, creating headroom for a rate cut at the central bank's rate-setting panel meeting under new Governor Sanjay Malhotra in February.

The Consumer Price Index (CPI) based headline inflation was at 6.21 per cent in October and 5.55 per cent in November 2023.

India's industrial production (IIP) growth slowed to 3.5 per cent year-on-year in October 2024, mainly due to poor performance of mining, power and manufacturing, as per official data released on Thursday.

"The domestic market smartly recovered from the day's low and moved out of the consolidation path led by index heavyweights. A gradual easing in food inflation and a price hike by FMCG companies, along with a recent correction in valuation, supported the sector to outperform. Currently, the market is anticipating a revival in consumer spending, driven by the festive season and year-end holidays, adding to the sentiments.

"Additionally, expectation of an increase in US spending is propelling the IT sector," Vinod Nair, Head of Research, Geojit Financial Services, said.

In Asian markets, Tokyo, Shanghai and Hong Kong settled lower while Seoul ended higher.

Markets in Europe were trading higher. Wall Street ended in the negative territory on Thursday.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 3,560.01 crore on Thursday, according to exchange data.

Global oil benchmark Brent crude climbed 0.54 per cent to USD 73.77 a barrel.

The 30-share BSE benchmark declined 236.18 points or 0.29 per cent to settle at 81,289.96 on Thursday. The Nifty dropped 93.10 points or 0.38 per cent to 24,548.70.