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Indian equity benchmarks ended higher for the third consecutive session on Thursday tracking strong global cues, easing crude oil prices and investor cheer on election results where Bharatiya Janata Party (BJP) was leading in four out of five states. An across-the-board rally swept the markets with FMCG, Realty, Metal and Banking sectors leading from the front. Markets opened with a significant gap on the upside, as traders took some support with Union Minister of Commerce and Industry Piyush Goyal stating that the venture capitalists have played a pivotal role in India's startup story and the economic growth of the country. Addressing the Indian Venture and Alternate Capital Association's (IVCA) Conclave, he said they have been driving innovation and bringing new ideas to the fore. Some support also came as private report stated that hiring activity witnessed a three per cent uptick sequentially in February as almost all industries showcased strong growth with the end of the third wave of the pandemic. Adding to the optimism, report stated that India and Canada are set to hold talks during March 10-13 to further strengthen the bilateral ties and discuss economic partnership, including a free trade agreement between both nations.

However, key indices trimmed some of their gains in late afternoon deals, as traders turned anxious with Ratings and Research’s (Ind-Ra) report that the country's current account deficit (CAD) is likely to widen to a 13-quarter high of $23.6 billion or 2.8 per cent of GDP in October-December 2021-22 (Q3FY22) as against a deficit of $9.6 billion (1.3 per cent of GDP) in Q2 FY22, due to higher commodity prices following the Russia-Ukraine conflict. In Q3 FY21, the deficit was $2.2 billion (0.3 per cent of GDP). Traders took a note of Former Reserve Bank of India (RBI) governor Raghuram Rajan’s statement that India needs to recalibrate its response to the price situation following disruptions in global supply chains on account of Russia-Ukraine war, as losing the battle against inflation neither serves the government nor the central bank. Further, he said it is very important for any central bank to respect its mandate given to it by the government.

On the global front, European markets were trading lower, as investors also await the European Central Bank's policy decision, which could highlight the impact of the conflict on the euro zone economy. Asian markets ended higher on Thursday after oil prices tumbled by the most in nearly two years and Ukraine's president said one of Russia's negotiating demands could be met. Oil prices regained some footing in Asian trade after having fallen more than 12 percent in the previous session as two members of the OPEC oil cartel said they would support increasing production. Back home, there were some reaction in defence industry stocks as Niti Aayog member V K Saraswat said India's defence sector will not face any problems because of the western sanctions on Russia as Moscow has an inherent military strength and is self-sufficient in its production capabilities. Stocks related to diamond industry were in watch as Crisil report warned that the crippling economic sanctions imposed by the US and European nations on Russia following its invasion of Ukraine threaten to take the sheen off the domestic diamond industry, culling its sales by 25-30 per cent worth $2-2.5 billion in the next quarter alone.

Finally, the BSE Sensex rose 817.06 points or 1.50% to 55,464.39 and the CNX Nifty was up by 249.55 points or 1.53% to 16,594.90.  

The BSE Sensex touched high and low of 56,242.47 and 54,982.82, respectively. There were 27 stocks advancing against 3 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 1.06%, while Small cap index was up by 1.18%.

The top gaining sectoral indices on the BSE were FMCG up by 2.68%, Realty up by 2.16%, Metal up by 2.04%, Bankex up by 1.98% and Basic Materials up by 1.97%, while there were no losing sectoral index on the BSE.

The top gainers on the Sensex were Hindustan Unilever up by 5.17%, Tata Steel up by 4.27%, SBI up by 3.70%, Indusind Bank up by 3.28% and Axis Bank up by 3.04%. On the flip side, Tech Mahindra down by 1.28%, Dr. Reddy's Lab down by 0.78% and TCS down by 0.36% were the top losers.

Meanwhile, Former Reserve Bank of India (RBI) governor Raghuram Rajan has said that India needs to recalibrate its response to the price situation following disruptions in global supply chains on account of Russia-Ukraine war, as losing the battle against inflation neither serves the government nor the central bank. Further, he said it is very important for any central bank to respect its mandate given to it by the government.

He stated India’s central bank has a mandate, which has served it well, in the sense of allowing it to react to some of the concerns during the pandemic, without raising rates, having moderate inflation. The RBI has a mandate to keep inflation target of 4 per cent with a +/-2 per cent tolerance band. ‘And like every other central bank, as we come out of it and face new challenges, we have to recalibrate and ask whether the old playbook sort of still holds,’ he said, adding that he thinks that’s extremely important.

The retail inflation rate breached the 6 per cent upper tolerance limit of the RBI for the first time in seven months in January, while the wholesale-price index stayed in double-digits for the 10th month in a row. He said this (inflation) is coming on top of an already high level of inflation in many parts of the world. He added 'So when you add the additional effects of war, it gives greater weight to inflation'.

The CNX Nifty traded in a range of 16,757.30 and 16,447.90. There were 43 stocks advancing against 7 stocks declining on the index. 

The top gainers on Nifty were Hindustan Unilever up by 5.16%, Tata Steel up by 4.30%, Grasim Industries up by 4.13%, SBI up by 3.48% and JSW Steel up by 3.40%. On the flip side, Coal India down by 3.75%, Tech Mahindra down by 1.46%, Dr. Reddy's Lab down by 1.23%, UPL down by 0.58% and ONGC down by 0.57% were the top losers.

European markets were trading lower; UK’s FTSE 100 decreased 62.48 points or 0.87% to 7,128.24, France’s CAC decreased 132.06 points or 2.07% to 6,255.77 and Germany’s DAX decreased 290.33 points or 2.1% to 13,557.60.

Asian markets ended higher on Thursday amid slightly easing worries about inflation following a drop in commodity prices. Traders were also picking up stocks at a bargain after the recent sell-off due to the escalation in the Russia-Ukraine conflict and stringent sanctions imposed on Russia. Traders also remained optimistic amid ongoing talks to diffuse the Russia-Ukraine crisis, with Ukraine President Volodymyr Zelensky no longer pressing for NATO membership for Ukraine, a delicate issue that was one of Russia's stated reasons for invading its pro-Western neighbour. Chinese markets ended higher after Ukraine said it is ready to make reasonable concessions to end the war.

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