Rupee, IT stocks, global cues: Why Sensex ended 456 points higher today

Snapping previous session’s losses, the benchmark indices on Friday staged a smart recovery led by gains in IT and pharma stocks after the rupee on Thursday hit its all-time low against dollar. Positive global cues as dollar retreated from 14-year high mark also added to the gains.
 
The S&P BSE Sensex settled the day at 26,316, up 456 points, while the broader Nifty closed at 8,114, up 149 points. In broader markets, BSE Midcap was up 1.3% while smallcap ended 2% higher.

Export-driven businesses like information technology (IT) and pharmaceutical rallied on the index today after rupee touched its record low on Thursday.  These stocks earn more revenues on rupee depreciation as every dollar earned through exports means more rupees added to their bottom line.
 
NSE IT was the top sectoral gainer and settled the day nearly 4.75% higher, with TCS, Infosys and Tech Mahindra gaining 5.9%, 4.77% and 5.83% respectively . 
 
“If the Nifty IT goes above 9,724, its previous week high, next target for the index will be 10,045, its second week high. Today, the index gave a breakout of its weekly high of 9,724 and if it sustains above it, then we might see a short term rally in the index,” said brokerage Dynamic Equities in a technical note.
 
Nifty Pharma index 3% higher with Sun Pharma (4.39%) gaining the most. Other gainers included Aurobindo Pharma (4.04%) and Lupin (3.16%).

Metal companies traded higher for the fourth straight-session with BSE Metals rising more than 2% during the day.  NALCO ended the day 7.74% higher followed by JSW Steel (3.62%), SAIL (2.86%) and JSPL (2.70%).

Snapping its five-session long losing streak, rupee recovered to as low as 68.36 in the late morning deals after the Reserve Bank of India intervened heavily in the morning trade to arrest the currency's fall. 

The rupee fell to a record low of 68.8650 on Thursday, pressured by a rallying US dollar, capital outflows from emerging markets, and worries about the country's demonetisation drive.

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