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Equities ride bulls ahead of Diwali, Nifty scales record highs (Market Review)

By Porisma P. Gogoi
Mumbai, Oct 14 (IANS) Supported by good buying sentiments ahead of Diwali, key Indian equity indices rode the bulls for the second consecutive week, with the wider Nifty50 of the National Stock Exchange (NSE) hitting record highs on the last trading day of the week.

Market observers said the risk-taking appetite of investors got a major fillip by domestic data indicating stable inflation and healthy factory output, coupled with positive global cues, upbeat quarterly earnings data of an IT major and strong domestic flow of funds.

The Nifty50, on Friday (October 13), closed trade at a new high of 10,167.45 points, surpassing its previous closing high of 10,153.10 points scaled on September 18. On a weekly basis, it edged higher by 187.75 points, or 1.88 per cent.

The index also hit a fresh intra-day high of 10,191.90 points on Friday, crossing its previous high of 10,178.95 points on an intra-day basis scaled on September 19.

The 30-scrip Sensitive Index (Sensex) of the BSE, too, witnessed a strong closing at 32,432.69 points — up 618.47 points, or 1.94 per cent, on a weekly basis — its highest level since August 1 when it closed at a high of 32,575.17 points.

“So far this year, Sensex has gained 22 per cent, while Nifty is up 24 per cent,” Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS.

D.K. Aggarwal, Chairman and Managing Director, SMC Investments and Advisors, said: “In the week gone by, the domestic stock market, which has been on a northward move for the last two weeks, is expected to be further buoyed by signs of easing of geo-political tensions and huge inflow in mutual funds.”

According to data provided by market analysts, domestic mutual funds have received inflows of $16 billion from April to September 2017.

“Also, good demand on consumer stocks on arrival of festival season and interest in pharma stocks amid positive regulatory approvals supported the bulls,” Aggarwal told IANS.

“Industrial production expanded to a nine-month high of 4.3 per cent in August while retail inflation was stagnant at 3.28 per cent in September compared to the previous month. The domestic currency, which was under pressure, has now got some strength as against the US dollar to hit near three-week high,” he added.

During the week, the Indian rupee appreciated by 45 paise to close at 64.93 to a US dollar from its previous week’s close at 65.38.

Head – Equity of Kotak Life Insurance Hemant Kanawala told IANS that the two major factors that influenced the markets during the week were strong domestic flow of funds and continued pressure on earnings.

“FIIs have sold $1.6 billion in the month of September taking their net selling to $3.3 billion in the last two months,” Kanawala pointed out.

Provisional figures from the stock exchanges showed that FIIs off-loaded stocks worth Rs 3,454.51 crore during the week. However, domestic institutional investors continued to pump-in funds and bought scrip worth Rs 3,154.04 crore.

Figures from the National Securities Depository (NSDL) revealed that foreign portfolio investors (FPIs) divested equities worth Rs 1,224.36 crore, or $187.76 million, during October 9-13.

“Global economies (US, Europe and China) are showing signs of improvement which was helping domestic sectors like metals and mining and chemicals due to increase in commodity prices,” said Vinod Nair, Head of Research, Geojit Financial Services.

“Further, better results from IT major Tata Consultancy Services (TCS) and a strong earnings expectation from oil and gas major helped market momentum. Mid and small-cap attracted investor attention led by ease in GST rates and stock specific actions,” Nair added.

The top weekly Sensex gainers were: Bharti Airtel (up 12.86 per cent at Rs 431.45); Reliance Industries (up 4.76 per cent at Rs 876.70); TCS (up 4.74 per cent at Rs 2,561); Axis Bank (up 4.54 per cent at Rs 527.35); and Adani Ports (up 4.47 per cent at Rs 406.30).

The losers were: ONGC (down 2.07 per cent at Rs 170.10); State Bank of India (down 1.64 per cent at Rs 252.45); Dr. Reddy’s Lab (down 1 per cent at Rs 2,354); Maruti Suzuki (down 0.53 per cent at Rs 7,868.25); and Tata Motors (DVR) (down 0.52 per cent at Rs 237.95).

(Porisma P. Gogoi can be contacted at [email protected])

–IANS
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