Equity markets surge on positive global cues (Roundup)

Mumbai, Sep 6 (IANS) Positive global cues and healthy inflow of foreign funds pushed the Indian equity markets higher on Tuesday.

Both the key indices touched their 52-week high in almost 18 months and closed the day’s trade in the green with gains of over 1.5 per cent each.

The wider 51-scrip Nifty of the National Stock Exchange (NSE) surged by 133.35 points, or 1.51 per cent, to 8,943 points — crossing the 8,900-point level for the first time since March 5, 2015.

The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 28,631.27 points, closed at 28,978.02 points — up 445.91 points, or 1.56 per cent, from the previous close at 28,532.11 points.

The Sensex touched a high of 29,013.40 points and a low of 28,631.27 points during the intra-day trade.

The BSE market breadth was tilted in favour of the bulls — with 1,619 advances and 1,146 declines.

On Friday last week, the key indices had closed with substantial gains due to buying support.

The barometer index had gained 108.63 points, or 0.38 per cent, while the NSE Nifty edged up by 35 points or 0.40 per cent.

The Indian markets were closed on Monday on account of Ganesh Chaturthi.

Initially on Tuesday, the benchmark indices opened on a higher note following positive global cues.

In addition, investors’ risk-taking appetite increased after a dismal US non-farm payrolls data which was released on last Friday. The data has reduced the potential for a September rate-hike.

The US data for last month showed that the economy created 151,000 jobs, against 275,000 jobs in July.

A US rate hike could potentially lead to a massive pull-back of foreign funds from emerging economies like India.

It is also expected to dent business margins as access to capital from the US will become expensive.

Besides, healthy inflow of foreign funds, follow-up buying from last week’s strong close and a firm rupee supported the positive sentiment.

The Indian rupee strengthened by 30 paise to 66.53 against a US dollar from its previous close of 66.83 to a greenback on last Friday.

“The equity markets have touched new highs of the year since March 2015,” Anand James, Chief Market Strategist at Geojit BNP Paribas Financial Services told IANS.

“The global markets were largely positive on lower chances of a US rate hike. Moreover, healthy inflow of foreign funds gave a positive momentum to the domestic markets.”

According to Dhruv Desai, Director and Chief Operating Officer of Tradebulls, the CNX Nifty traded firm, tracking positive global cues.

“CNX Nifty traded firm throughout the session and held on to its initial gains in the second half of the session as well,” Desai said.

“Banking and pharma sector stocks traded with firm sentiments while auto and FMCG (fast moving consumer goods) stocks also traded firm. Aviation stocks failed to recover tracking firm sentiments in crude oil prices.”

He pointed out that while most oil and gas stocks faced resistance at higher levels due to lack of buying interest from traders, sugar stocks traded with mix sentiments on short covering.

“USD/INR futures failed to recover in second half of the session which supported firm sentiments in Nifty,” he added.

In terms of investments, provisional data with the exchanges showed that the foreign institutional investors (FIIs) purchased stocks worth Rs 1,438.72 crore, whereas the domestic institutional investors (DIIs) divested scrips worth Rs 268.21 crore.

Sector-wise, healthy buying was witnessed in all the 19 sub-indices of the BSE, led by stocks of banking, automobile and consumer durables.

The S&P BSE banking index augmented by 675.97 points, followed by the automobile index, which rose by 631.26 points, and the consumer durables index gained 367.26 points.

Major Sensex gainers during Tuesday’s trade were: Tata Motors, up 7.19 per cent at Rs 598.35; Axis Bank, up 6.14 per cent at Rs 635.95; ICICI Bank, up 4.25 per cent at Rs 272.45; Tata Steel, up 3.25 per cent at Rs 385.85; and Asian Paints, up 2.97 per cent at Rs 1,200.70.

Major Sensex losers were: Tata Consultancy Services (TCS), down 1.17 per cent at Rs 2,484.05; Coal India, down 1.11 per cent at Rs 328.80; Wipro, down 0.11 per cent at Rs 482.80; and ITC, down 0.04 per cent at Rs 262.35.

–IANS

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