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Markets rebound: Sensex jumps 1,534 points, Nifty settles at 16,266

NEW DELHI: Equity indices rebounded sharply on Friday amid broad-based buying across all sectors, a day after crashing to nearly 2 month low.

The 30-share BSE index jumped 1,534 points or 2.91 per cent to close at 54,326. While, the broader NSE Nifty settled 457 points or 2.89 per cent higher at 16,266.

Dr Reddy's, Reliance, Nestle India, Tata Steel and L&T were the top gainers in the sensex pack rising as much as 8.10 per cent. All 30 shares finished in green.

On the NSE platform too all sub-indices settled higher with Nifty Metal, Media, Realty and Pharma gaining up to 4.47 per cent.

Here are the top reasons for today's market rally:

* Metal index led the gains

Metal stocks, which slid over 4 per cent in the previous session, rebounded to close 4.2 per cent higher. The sub-index snapped five weekly losses and gained 7.4 per cent for the week.

Shares of all domestic metal producers like JSW Steel, Hindustan Copper, Tata Steel, Vedanta surged between 2-7 per cent.

The stocks gained after world's largest commodity consumer China cut its 5-year prime rate by 15 basis points to 4.45 per cent in a bid to boost economic activity ravaged by the latest outbreak of Covid in the country which forced it to opt for fresh lockdowns.

* China cuts lending rates

Investor sentiment around the globe improved after China cut a key benchmark lending rate to support its economy.

Global equities gained on Friday, as China's move helped ease some pressure owed to the Russia-Ukraine conflict, prospects of bigger interest rate hikes to contain surging inflation and supply-chain issues that have been worsened by China's zero-Covid policy.

The MSCI world equity index, which tracks shares in 50 countries, rose 0.5 per cent after China cut its five-year loan prime rate, which influences the pricing of mortgages, by 15 basis points.

* FM projects 8.9% GDP growth

Investors also cheered finance minister Nirmala Sitharaman's comments on robust economic growth in India.

At an event on Thursday, the finance minister said that India is likely to be robust at 8.9 per cent in the current financial year, reflecting the country's strong resilience and speedy recovery.

Sitharaman also expressed confidence that India will continue to achieve a high growth rate in the next financial year as well.

* Dr Reddy's top gainer in BSE

Share sof Dr Reddy's Laboratories gained over 8 per cent after the pharma major declared its fourth quarter results on Thursday.

Revenue during the quarter under discussion was up by 15 per cent to Rs 5,436.8 crore compared with Rs 4,728.4 crore in the last quarter of FY21.

GV Prasad, co-chairman and managing director of Dr Reddy's, said the drug-maker clocked nearly $1 billion revenue from the North American markets.

* Asian markets rise

In Asia, the Shanghai Composite Index rose 1.2 per cent to 3,134.21 after the Chinese central bank reduced its rate on a five-year loan, which would shore up weak housing sales by cutting mortgage costs.

The one-year loan rate that affects commercial borrowers was left unchanged.

That suggests Beijing is “trying to keep easing targeted and that we shouldn't expect large-scale stimulus,” said Julian Evans-Pritchard of Capital Economics in a report.

The Nikkei 225 in Tokyo jumped 1.3 per cent to 26,746.24 after Japanese consumer inflation rose to 2.5 per cent in April from the previous month's 1.3 per cent. It was the first time since 2008 that inflation was above the central bank's 2 per cent target.

(With inputs from agencies)