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Sensex ends above 27000, heavyweights lead show; cements up

16:57

The News International Team

Another record closing high with equity benchmarks hitting new milestones on Tuesday was an indication that bulls want to stay a bit longer on Dalal Street post Modi’s assurance to Japanese investors for conducive business environment in India. The 30-share BSE Sensex closed above the 27000-mark for the first time while the 50-share NSE Nifty hit 8100 level intraday though it failed to hold the same level.

The achievement of historical high was completely led by heavyweights like HDFC twins, ITC, Reliance Industries and Bharti Airtel, though selling in ICICI Bank and Tata Motors capped the somewhat upside.

The Sensex rose 151.84 points to 27019.39 and the Nifty climbed 55.35 points to 8083.05 after hitting intraday high of 27082.85 and 8101.95, respectively. The broader markets beat benchmarks with the BSE Midcap and Smallcap indices gaining nearly a percent.

The market’s unstoppable northward journey encouraged experts to remain super bullish on India. They increased targets on benchmarks and suggested strategy of buying on every dip.

Morgan Stanley has upgraded its June 2015 target for the Sensex to 28800 after today’s rally, says managing director, Ridham Desai.

He expects the Sensex to rally as high as 33900, but with some conditions. If the government continues to work on it fiscal consolidation path and the Fed doesn’t take an disruptive policy action, then Desai feels the benchmark index has about 40 percent chance of seeing this level by June 2015.

Meanwhile, in a speech to Japanese investors, Prime Minister Narendra Modi today said there is no “red tape” but only “red carpet” for investors as the government has eased a lot of regulations. According to him, the coming together of Japan’s hardware skills and India’s software expertise can create miracle. “India is the only place where one can find ‘democracy, demography and demand’. India is a ‘god gifted location’ for reaching out to global markets,” he said.

Telecom, healthcare, banking and financials, and oil and gas stocks supported the market while metals remained under pressure.

Heavyweights like Reliance Industries, ITC, HDFC and HDFC Bank gained 1-2 percent.

Drug maker Cipla topped the buying list, up over 5 percent on launch of inhaler Seroflo in Germany and Sweden. It expects to launch Seroflo in other European countries in 12-18 months.

Ranbaxy Labs gained 3.5 percent on reports that Drug Controller General of India reinstated European Union export licence to company’s Toansa unit. DCGI had suspended supply from this unit to European Union in May. Sun Pharma, which will become the owner of Ranbaxy soon, rallied 2.5 percent.

Huge buying interest was seen in cement stocks on the back of higher growth in cement sector (at 16.5 percent in July versus 13.6 percent in June) among eight infrastructure sectors. Grasim Industries, ACC and Ambuja Cements rallied 3-4 percent.

Telecom stocks too were on buyers’ radar on reports that the Narendra Modi government has been planning a new super regulator for the communications sector. New regulator will be called as Communications Commission, which may replace Telecom Regulatory Authority of India (TRAI), said sources. Bharti Airtel was up 4.24 percent and Idea Cellular gained 3.4 percent.

Two-wheeler major Hero Motocorp rose 1.5 percent to end at new closing high of Rs 2801.65 after registering 21 percent growth year-on-year in August sales by selling 5.58 lakh units of two-wheelers. Its rival TVS Motor too saw new closing high, up 4 percent after reporting 46 percent growth in August sales. However, Tata Motors lost 0.7 percent as total sales fell 18 percent to 40,883 units year-on-year.

Among others, ONGC, State Bank of India, Axis Bank, GAIL and Dr Reddy’s Labs gained 0.5-1 percent whereas ICICI Bank, Sesa Sterlite, HUL, Wipro, M&M, Tata Steel, Hindalco, Tata Power and Coal India fell 0.5-2 percent.

Advancers outperformed decliners by a ratio of 1750 to 1244 on the BSE.

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