SVB acquisition buoys investors

Equity benchmark Sensex snapped two-day losing streak to close 126 points higher on Monday, propped up by buying in index heavyweights Reliance Industries (RIL), Maruti and SBI amid a higher opening in European equities. However, investors remained cautious amid stress in the US and European financial systems, traders said.

The 30-share BSE Sensex climbed 126.76 points or 0.22 per cent to finish at 57,653.86. During the day, the index witnessed a high of 58,019.55 and a low of 57,415.02. The broader NSE Nifty advanced 40.65 points or 0.24 per cent to end at 16,985.70, with 27 of its scrips ending in the green.

"Nifty opened positive and remained steady for most of the session as SVB's resolution provided some relief to the market. Investors took comfort from the news that First Citizens Bank shares will acquire SVB's deposits and loans. However, selling in the last half an hour led to the flat closing of the market at 16,986 (+0.2 per cent)," said Siddhartha Khemka, head (retail research), Motilal Oswal Financial Services Ltd.

"Most Asian stocks struggled on Monday amid renewed concerns over more defaults in US and European banks, with Chinese markets falling the most as weak results pulled oil and gas shares lower. European shares were higher after First Citizens Bank shares soothed fragile markets on Monday by saying that it would take the deposits and loans of failed Silicon Valley Bank," said Deepak Jasani, head (retail research), HDFC Securities.

Foreign Portfolio Investors (FPIs) offloaded equities worth Rs1,720.44 crore on Friday, according to exchange data. A strengthening rupee bolstered sentiment, even as relentless foreign capital outflows restricted the gains, according to traders.

In the broader market, the BSE smallcap gauge ended 1.50 per cent lower, while the midcap index dipped 0.37 per cent. Among sectoral indices, healthcare, FMCG, bankex, metal and teck were the gainers. However, power, utilities, industrials, auto, realty and services were the major laggards. The utility index fell by 2.48 per cent and power declined by 2.13 per cent.