The National Stock Exchange (NSE) 50-share index CNX Nifty crossed the psychologically key level of 8,000 points for the first time on Monday after the country’s economy expanded at its fastest pace in more than two years in the April-June quarter.
For the quarter ended June this year, India’s economy grew at a nine-quarter high of 5.7%, compared with 4.6% in the previous quarter. For the June quarter of 2013-14, gross domestic product (GDP) had increased 4.7%.
The benchmark index hits record high of 8,022.70 in intra-day trades today, rallied 17% or 1,164 points from its closing level of 6,858.80 on May 9, 2014, after the Narendra Modi-led Bharatiya Janata Party (BJP) won a clear majority in the Lok Sabha elections.
The rally has been backed by sustained foreign institutional investor (FII) flows and participation of domestic mutual funds, which have bought close to Rs 60,000 crore since May 9. Better-than-expected corporate earnings for the quarter ended June also boosted sentiment.
FII inflow totalled Rs 44,426 crore ($ 7.4 billion), while mutual funds invested a net of Rs 14,012 crore in Indian equities between May 9 and August 28, data from the Securities and Exchange Board of India show.
CNX Auto and CNX Pharma index surged more than 25% each, while CNX Realty, CNX Metal and CNX IT gained between 18-22% during Nifty’s 1,000 points rally.
Among the individual stocks – Sesa Sterlite, Bharat Petroleum Corporation Limited (BPCL), Maruti Suzuki India, Tech Mahindra, Lupin, Hindustan Unilever and Cipla gaining between 30-52% during the period.
Mahindra and Mahindra, Oil and Natural Gas Corporation (ONGC), Grasim Industries, UltraTech Cement, Tata Steel, Tata Motors, Kotak Mahindra Bank, Bharat Heavy Electricals, DLF, IDFC, Axis Bank, and HDFC are among few appreciating between 20-30%.
However, United Spirits, Jindal Steel and Power and Cairn India recorded negative returns up to 13%, while Reliance Industries, ITC and Ambuja Cements underperformed the market by reporting less than 5% gain during the period.