Closing Bell: Rupee’s sharp recovery helps Sensex end 300 pts higher, Nifty ends at 11,370

A dramatic recovery in the rupee has helped benchmarks surge to the high points. The Indian currency surpassed the level of 72 per US dollar-mark, leading to a massive buying among investors. The Sensex managed to end over 300 points higher, while the Nifty rose above 11,350-mark.

Sharp buying among major sector such as banks, FMCG, infrastructure, metals, and pharmaceuticals led to the upmove on Sensex and the Nifty. The Nifty Midcap index rose over one-third of a percent. The likes of HDFC Bank, Reliance and ITC, among others, rallied and helped the indices have a strong close.

At the close of market hours, the Sensex ended higher by 304.83 points or 0.81% at 37717.96, while the Nifty soared 83.40 points or 0.74% at 11370.90. The market breadth is negative as 1,123 shares advanced, against a decline of 1,503 shares, while 200 shares were unchanged.

Power Grid, Adani Ports and ITC were the top gainers, while Axis Bank and Tata Motors lost the most.

Shares of the state-run oil marketing companies Indian Oil Corporation (IOC), Hindustan Petroleum Corporation (HPCL) and Bharat Petroleum Corporation (BPCL) fell more than a percent each on rising crude oil prices and sustained volatility in the Indian rupee against the US dollar.

Aviation companies such as Jet Airways and InterGlobe Aviation also corrected over a percent as oil constitutes bigger portion of their operating expenses.

Crude oil prices have gradually been rising on reports of decline in US crude inventories and likely supply tightening ahead of US sanctions on the Iranian oil which will come into effect from November this year.

Shares of KIOCL soared over 11 percent after the company said it will be considering a buyback proposal at its Board Meeting on September 18, 2018. The Board of Directors will be meeting on that day to discuss the issue.

Rupee is tradingnear the day's high point, as it recovered 80 paise from its record low of 72.91 per dollar.

Currenly it is trading at 72.19 per dollarafter hitting a day's high of 72.11 per dollar.

Research house HSBC has maintained buy rating on Oil India with a potential upside of 33 percent. The firm raise target to Rs 270 from Rs 253 per share.

It also maintained buy on ONGC with a target of Rs 240. It sees potential upside of 43 percent.

The upside from higher oil is to be offset by risks of higher costs and subsidy burden.

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Image: Bloomberg

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