The News International Team
The market staged spectacular performance on last day of the week (Friday), rallying nearly a percent on the Sensex boosted by European Central Bank’s stimulus package. However, the broader markets underperformed frontline indices.
Sachin Shah of Emkay Investment Managers believes the undertone for the market is still buoyant. According to him, with the overall macros starting to show signs of improvement, and no major disappointment from earnings so far, FIIs pumped in more money into India.
Equity benchmarks rallied for the seventh consecutive session today, rising 1932 points on the Sensex and 558 points on the Nifty (in 7 days) on broad based buying, especially ahead of January-expiry and Union Budget (that decided to be held February 28).
The 30-share BSE Sensex today gained 272.82 points or 0.94 percent at 29278.84 and the 50-share NSE Nifty closed above the 8800 level for the first time, up 74.20 points or 0.85 percent at 8835.60. However, the broader markets closed marginally lower.
European Central Bank’s President Mario Draghi on Thursday evening announced a bond-buying programme worth over one trillion euros to stave off the deflation threat. The purchases will start on March this year and will last till September 2016.
Geoff Lewis, ED, JP Morgan Asset Management says buying euro 60 billion (USD 68 billion) of assets every month during the period, aggregating to 1.1 trillion, is a big commitment that may result in European equities outperforming S&P 500. “2015 will be a year of ample global liquidity,” he said adding a lot of the money will flow into emerging economies including India.
Global markets cheered the ECB stimulus program with European markets like France’s CAC, Germany’s DAX rising over a percent (at the time of closing of Indian equities). Asian markets also closed higher with the Japan rising to a near three week highs, up 1 percent and the Kospi climbing to 4-week highs, up 0.8 percent. Hang Seng, Straits Times and Taiwan Weighted gained more than a percent.
Crude oil prices recovered marginally as news of the death of Saudi Arabia’s king Abdullah added to uncertainty in energy markets. Brent crude rose 95 cents to USD 49.47 a barrel and NYMEX crude was up 56 cents to 46.87 a barrel.
The rupee also cheered ECB, appreciating 27 paise to 61.42 a dollar on selling by exporters amid sustained capital inflows. Soaring domestic equity markets also supported the rupee.
The Sensex was up 4.1 percent and Nifty gained 3.8 percent while the BSE Smallcap Index was up 0.5 percent and CNX Midcap rose 1.3 percent during the week.
Indian markets will remain shut on Monday (January 26) for Republic day.
Bank Nifty also ended at record closing high today, which surpassed the 20000-mark. The index rose 155 points to 20,072.70. HDFC Bank rallied 2 percent and SBI was up 0.9 percent while rival ICICI Bank gained 0.3 percent. Housing finance company HDFC rose 0.8 percent.
Tata Power today saw huge buying interest in late trade, up nearly 7 percent and was the biggest gainer on Sensex. DLF spiked 5.5 percent while Cairn India jumped over 4 percent on rise in crude oil prices.
Tata Motors (which owns subsidiary in UK – Jaguar Land Rover), and Bharti Airtel rallied close to 4 percent. Larsen & Toubro, Mahindra & Mahindra, Cipla, Sesa Sterlite and Hindustan Unilever were up 2-3 percent.
However, Punjab National Bank, GAIL, BHEL, HCL Technologies and ONGC were down 1-2.7 percent.
Declining shares outnumbered advancing ones by a ratio of 1800 to 1146 on the Bombay Stock Exchange.