Markets build on gains ahead of Fed decision

The equity benchmarks darted up for the second straight session on Wednesday, as banking, auto, and IT stocks saw robust buying amid mixed global cues.

A strengthening rupee and supportive comments by the RBI governor also bolstered investor sentiment, traders said.

The Sensex jumped 258.50 points, or 0.66 per cent, to close at 39,302.85. The Nifty rose 82.75 points, or 0.72 per cent, to finish at 11,604.55.

M&M was the top gainer in the Sensex pack, climbing 4.24 per cent, followed by Bajaj Auto, Sun Pharma, HDFC Bank, Infosys, L&T, and Ultratech Cement.

On the other hand, Indusind Bank, NTPC, SBI, ONGC, Bharti Airtel, and Axis Bank were among the laggards, skidding up to 1.80 per cent.

According to traders, stockspecific action and sustained foreign fund inflows drove domestic equities higher, despite mixed cues from global markets ahead of the US Federal Reserve’s policy outcome. Foreign institutional investors bought equities worth ~1,170.89 crore on a net basis on Tuesday, exchange data showed.

RBI Governor Shaktikanta Das on Wednesday said economic recovery is still not well entrenched and that the central bank is “battle ready” to take appropriate measures for liquidity and growth. Das said Q1 GDP data was a “reflection of the ravages of the Covid-19”, but highfrequency indicators such as PMI numbers point to some stabilisation of economic activity.

“Global cues were also positive as participants awaited policy statement from the US FOMC meeting. Markets are expected to be in sync with global cues tomorrow. Upsides seem to be limited, considering the lack of fresh domestic triggers for the market,” said Vinod Nair, head of research at Geojit Financial Services.