January 17, 2018, 11:52

Markets continue bull run, end day at new high

Markets continue bull run, end day at new high

MUMBAI: The equity markets soared to a record high on Monday amidst fresh buying in index stocks on hopes that the upcoming Budget would propose measures to revive growth and investment in the economy. 

Expectation about an improvement in corporate earnings growth has also helped the markets to maintain their winning momentum. 

 

The Nifty scaled above the 10,600 level mark for the first time and closed the session at 10,623.60, up 64.75 points or 0.61 per cent while the Sensex gained 198.94 points or 0.58 per cent to end at a new closing high of 34,352.79. 

According to the provisional data released by the stock exchanges, foreign portfolio investors (FPI) bought shares worth Rs 692.83 crore on Monday. 

“What we are seeing is that some of the neglected sectors such as pharmaceuticals are moving higher as they are finding support from fresh fund flow from overseas investors. Additionally, there is a broader expectation that the Q3FY18 earnings growth of India Inc would be on a higher side both on a quarter-on-quarter (QoQ) as well as on a year-on-year (YoY) basis,” said Deven Choksey, MD of K.R.Choksey Securities. 

According to him, the momentum is likely to continue as the government’s focus is likely to shift towards execution of the reforms initiated in the past few months.

The rally was broad based with small- and mid-cap stocks rallying higher. Out of 3,120 stocks traded on the BSE, 1,792 stocks advanced as against 1,158 stocks that declined. 

The strong participation from smaller counters led to the BSE small and mid cap index outperforming the Sensex by gaining 1 per cent each. 

“Now, market participants have started naming this recent up move as a ‘Pre-Budget’ rally.  And hence, some of the thematic pockets (related to Budget) are attracting traders’ attention,” said Sameet Chavan, derivative analyst at Angel Broking. 

 As far as index levels are concerned, he said, 10,630-10,650 level would act as stiff resistance for the Nifty, which may force short term traders to book profits. 

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