The key equity indices pared some gains in the mid-morning trade. The Nifty traded below the 16,950 mark after hitting the day's high of 17,026.05 in the early trade. Pharma shares extended gaining streak for the third consecutive trading session. Investors awaited the outcome of a key meeting of the RBI's monetary policy committee due this week for domestic cues.

Trading could be volatile as traders roll over positions in the F&O segment from the near month September series to October series. The September 2022 F&O contracts will expire today, 29 September 2022.

At 11:30 IST, the barometer index, the S&P BSE Sensex, was up 242.74 points or 0.43% to 56,841.02. The Nifty 50 index gained 81.15 points or 0.48% to 16,939.75.

In the broader market, the S&P BSE Mid-Cap index rose 0.38% while the S&P BSE Small-Cap index gained 0.99%.

The market breadth was strong. On the BSE, 2,256 shares rose and 949 shares fell. A total of 142 shares were unchanged.

Meanwhile, the Reserve Bank of India (RBI)'s six-member Monetary Policy Committee began on 28 September 2022. RBI Governor Shaktikanta Das will announce the MPC decision on 30 September 2022, the last date of the meeting. The RBI is widely expected to maintain the balancing act between growth and inflation.

In the past three policy reviews, the RBI's rate-setting panel has raised 140 basis points in total since May this year. Currently, the repo rate, the interest rate at which the RBI lends to the commercial bank, stands at 5.40%.

Economy:

The Union Cabinet on Wednesday (28 September 2022) approved the release of additional installment of Dearness Allowance and Dearness Relief at 4% to Central Government employees and pensioners due from 1 July 2022.

The additional financial implications on account of this increase of Dearness Allowance to Central Government employees are estimated at Rs 6,591.36 crore per annum; and Rs 4,394.24 crore in the financial year 2022-23 (i.e. for a period of 8 months from July 2022 to February 2023).

The additional financial implications on account of this increase of Dearness Relief to pensioners are estimated at Rs 6,261.20 crore per annum; and Rs 4,174.12 crore in the financial year 2022-23 (i.e. for a period of 8 months from July 2022 to February 2023).

Buzzing Index:

The Nifty Pharma index rose 1.68% to 12,918.60, extending its winning streak for the third session. The index added 3.55% in three trading sessions.

Granules India (up 3.46%), Sun Pharmaceuticals Industries (up 3.34%), Torrent Pharmaceuticals (up 3.1%), Zydus Lifesciences (up 2.86%), Abbott India (up 2.32%), Dr Reddys Laboratories (up 2.25%), Laurus Labs (up 1.98%), Glenmark Pharmaceuticals (up 1.75%), Aurobindo Pharma (up 1.58%) and Ipca Laboratories (up 1.53%) edged higher.

On the other hand, Alkem Laboratories (down 1.43%), Lupin (down 1.32%) and Pfizer (down 0.52%) declined.

Lupin fell 1.32% after the company said its Tarapur facility in Maharashtra has received US drug regulator's warning letter. This action follows the inspection of the unit by the US Food and Drug Administration (USFDA) from 22 March 2022 to 4 April 2022. Lupin said it believes that the USFDA warning letter will not impact the supplies or the existing revenues from operations of this facility.

Stocks in Spotlight:

Bayer Cropscience declined 0.19%. The company said that its board has approved the sale of its Environmental Science Business to 2022 ES Discovery India on a slump sale basis, for a consideration of Rs 111.1 crore. The company's Environmental Science Business offers solutions to control pests, diseases and weeds in non-agricultural areas such as vector control and professional pest management.

Ramco Cements rose 0.94% after the company said that it has commissioned its fifth cement plant at Kolumigundla, Andhra Pradesh. The plant has a clinkerisation capacity of 2.25 million tonnes per annum. The project cost of the plant is Rs 3,000 crore. The company said that the plant is equipped with facilities to ensure operational efficiency and pollution free environment. The plant is capable of manufacturing various types of cement as per BIS specifications.

Global Markets:

Asian stocks traded higher on Thursday following a rebound on Wall Street overnight.

US stocks staged a comeback on Wednesday as the Bank of England said it would intervene in the bond market to stabilize conditions.

The Bank of England said on Wednesday that it would buy as many long-dated government bonds as needed between now and October 14 to stabilise financial markets, and added that it would postpone next week's start of its gilt sale programme.

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