Stock Market LIVE Updates: Sensex surges 1,041 points led by gains in financial, IT stocks; Nifty settles at 16,930

The auction of 5G spectrum for telephony services will stretch to the fourth day on Friday after 16 rounds of bidding fetched bids worth Rs 1,49,623 crore. Telecom minister Ashwini Vaishnaw on Thursday said 16 rounds of bidding have been completed in three days and the auction will continue on Friday.

The US economy contracted again in the second quarter amid aggressive monetary policy tightening from the Federal Reserve to combat high inflation, which could fan financial market fears that the economy was already in recession. Gross domestic product fell at a 0.9% annualized rate last quarter, the commerce department said in its advance estimate of GDP on Thursday. Economists polled by Reuters had forecast GDP rebounding at a 0.5% rate.

Equity indices extended gains for the 2nd straight session on Thursday and surged to 3-months high, led by gains in finance, metal and banking stocks. The 30-share BSE index jumped 1,041.47 points or 1.87% to close at 56,858; while the broader NSE Nifty settled 287 points or 1.73% higher at 16,930.

Consumer goods giant Nestle India ended 3.1% higher after saying it was seeing early signs of softening of prices in commodities such as edible oil and packaging materials.

The Nifty Midcap 100 and the Nifty Smallcap 100 indexes each closed 0.8% higher.

Bajaj Finance, Bajaj Finserv, Tata Steel, Kotak Bank and IndusInd Bank were the top sensex gainers. Bharti Airtel, UltraTech Cement, Dr Reddy's Laboratories, ITC and Sun Pharma were the losers.

Bajaj Finance, Bajaj Finserv, Kotak Mahindra Bank, Tata Steel and SBI Life Insurance were among major gainers on the Nifty. Losers included Shree Cements, Bharti Airtel, UltraTech Cement, Cipla and Dr Reddy's Laboratories.

Sensex surges 1,041 points to close at 56,858 led by gains in financial, IT stocks; Nifty settles at 16,930

ICICI Securities raised its target for the Nifty 50 to 17,500 from 16,600 for the coming months on structural improvement, with crude and industrial commodities prices falling sharply and India's Volatility Index cooling.

European shares hit a seven-week high on Thursday as some concerns were eased about the pace of rate hikes by the US Federal Reserve going forward, while a clutch of strong results including a quarterly profit for Shell, bolstered buying. The pan-European STOXX 600 index rose 0.5%.

“We continue to expect core inflation to push the Fed to hike more aggressively than they or markets anticipate,” analysts wrote, noting they expect the Fed will announce another three-quarter point increase at its September policy meeting, with further rate hikes continuing into early 2023.

Powell's comments were taken by some as a signal the Fed may not have to raise rates so aggressively in coming months, triggering a rally in the final hour of regular trading.

On Wall Street investors welcomed the Fed's widely expected move — which took its key interest rate to its highest level since 2018 — with a broad rally on Wednesday.

Elsewhere in Asia shares advanced, tracking gains on Wall Street after the Fed did exactly as expected and its chair, Jerome Powell, suggested the Fed’s rate hikes have already had some success in slowing the economy and possibly easing inflationary pressures.