Markets cheer IT earnings and global rally

At 10:10 am, Sensex was up 1.81 percent at 58,272 and Nifty 1.71 percent at 17,304.90.

Indian indices made a gap-up opening on October 14 with Sensex soaring 1,000 points and Nifty rallying over 250 points as global cheer and strong IT results spurred stocks.

At 10:10 am, Sensex was up 1.81 percent at 58,272 and Nifty 1.71 percent at 17,304.90. Market breadth favoured gainers as 2,282 shares advanced, 613 shares declined, and 111 shares remain unchanged.

All sectors traded in the green with Nifty IT index gaining 2.6 percent, led by HCL Tech, Infosys, and Tech Mahindra. Financial, infrastructure, and auto followed the IT pack, with over one percent gain each.

Here are the factors popping the markets higher:

US stocks surged to close more than two percent higher on Thursday as technical support and investors covering short bets drove a dramatic rebound from a selloff earlier in the day. The reversal marked a jump of nearly 194 points in the S&P 500 from its low of the session to its high, the biggest intraday jump for the index since January 24. Meanwhile, Dow closed over 800 points higher.

Following the rally in Wall Street, Nikkei 225 in Japan surged 3.46 percent, set for best day since March. Meanwhile, the Topix gained 2.69 percent. In Australia, the S&P/ASX 200 gained 1.91 percent. South Korea’s Kospi advanced 2.53 percent, and the Kosdaq climbed 4.28 percent.

Oil prices slipped in early Asian trade on Friday as US crude and gasoline inventories jumped. Brent crude futures fell 15 cents or 0.2 percent to $94.42 per barrel while US West Texas Intermediate (WTI) crude futures were down 21 cents or 0.2 percent at $88.90 per barrel.

Growth in large Asia Pacific economies like China, India, and Indonesia will be less affected as they are more domestically oriented, said S&P Global Ratings. However, slower global economic growth and external demand will weigh on economic activity, it added.

The earnings season has begun on a rather positive note in India. Infosys and HCL Tech’s robust performance lifted sentiments. Both the companies also raised their revenue forecasts.

V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said: "An important takeaway from the IT results announced so far is that the segment is doing well and the management commentary is optimistic. After the sharp correction in IT stocks from their highs, there is value in the segment now."

India's inflation based on the Wholesale Price Index (WPI) fell to an 18-month low of 10.7 percent in September, the commerce ministry said on October 14.

WPI inflation was 12.41 percent in August. In September 2021, it stood at 11.80 percent.

While wholesale inflation fell for the fourth consecutive month in September, it has been above the 10 percent mark for one-and-a-half years now.