Mumbai: Optimism around quarterly corporate earnings, along with an upward rally in banking stocks and healthy inflow of foreign funds, lifted the key Indian equity indices — the BSE Sensex and NSE Nifty50 — to record high levels on Wednesday.
Also, the government’s decision on Wednesday to cut the size of additional borrowing to Rs 20,000 crore of government securities from Rs 50,000 crore during the current fiscal uplifted the investors’ sentiments.
Despite weak global cues, the barometer 30-scrip Sensitive Index (Sensex) of the BSE closed above the vaunted 35,000-mark and the Nifty50 hit the 10,800-level intra-day — both for the first time.
The wider Nifty50 of the National Stock Exchange, which scaled a record high of 10,803 points intra-day, rose 88.10 points or 0.82 per cent, to close at a fresh high of 10,788.55 points.
The Bank Nifty recorded a fresh high of 26,328.40 points during the intra-day trade.
On the BSE, the Sensex closed firm at a fresh high of 35,081.82 points — up 310.77 points or 0.89 per cent from its previous session’s close — after touching a new intra-day high of 35,118.61 points.
However, the BSE market breadth remained marginally bearish as 1,476 stocks declined against 1,424 advances.
In the broader markets, the S&P BSE mid-cap index closed higher by 0.66 per cent and the small-cap index by 0.43 per cent.
“Sentiments remained buoyant as investors expect corporate results to improve, especially since numbers during the same period last year were impacted by a ban on high-value currency notes,” Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS.
Dhiraj Relli, Managing Director and CEO, HDFC Securities, said: “The lowering of additional borrowing requirement for current fiscal to Rs 20,000 crore from Rs 50,000 crore estimated earlier was welcomed by the market participants with the BFSI (banking, financial services and insurance) segment leading the pack.”
“It is remarkable, markets are rising in the phase of adverse expectations and scaling the 35,000-mark for the Sensex is an important landmark,” he added.
On the currency front, the Indian rupee strengthened by 15 paise to close at 63.88 against the US dollar from its previous close at 64.03.
Provisional data with the exchanges showed that foreign institutional investors purchased scrips worth Rs 625.13 crore and domestic institutional investors worth Rs 168.61 crore.
“The markets began the day on a weak note, however sentiment turned positive when the announcement from the government sources came saying that government can cut on borrowings with tax collections exceeding budgeted estimates and disinvestment targets,” said Anita Gandhi, Whole Time Director at Arihant Capital Markets.
“This led to softness in yields and buying interest in banking sector resumed,” she added.
Official data released during the day showed that the net Direct Tax collections by the government up to January 15 in the current fiscal (2017-18) stood at Rs 6.89 lakh crore (provisional) — which is 18.7 per cent higher than during the corresponding period of last year.
According to Sanjeev Zarbade, Vice President-PCG Research at Kotak Securities, the equity benchmarks ended at fresh record closing highs despite tepid global cues.
“Some easing in crude prices also fuelled market sentiment. Sector-wise, the rally was driven by banking and financials as well as technology, pharma, metals and select FMCG stocks,” Zarbade said.
All the 19 sub-indices of the BSE closed with gains, led by banking, capital goods and healthcare stocks.
The S&P BSE banking index augmented by 455.37 points, capital goods index by 314.51 points, and healthcare index by 171.63 points.
Major Sensex gainers on Wednesday were: Axis Bank, up 4.65 per cent at Rs 584.75; State Bank of India, up 3.44 per cent at Rs 306.35; ICICI Bank, up 2.68 per cent at Rs 343.10; Infosys, up 2.61 per cent at Rs 1,152.25; and Yes Bank, up 2.58 per cent at Rs 342.50.
Major Sensex losers were: Wipro, down 1.85 per cent at Rs 325.75; HDFC Bank, down 0.88 per cent at Rs 1,887; Hero MotoCorp, down 0.80 per cent at Rs 3,566.05; ONGC, down 0.74 per cent at Rs 195.65; and Hindustan Unilever, down 0.68 per cent at Rs 1,371.85.