Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Market / Stock-market-news/  Sensex, Nifty at all-time highs on reforms hope
BackBack

Sensex, Nifty at all-time highs on reforms hope

The Sensex closed 1.9%, or 519.50 points, higher at 27,865.83, while the Nifty ended 1.87%, or 153 points, up at 8,322.20

Intra-day, the Sensex touched an all-time high of 27,894.32, up 2%, or 547.99 points, while the broader 50-share CNX Nifty hit a lifetime high of 8,330.75, up 1.98%, or 161.55 points. Photo: Mint Premium
Intra-day, the Sensex touched an all-time high of 27,894.32, up 2%, or 547.99 points, while the broader 50-share CNX Nifty hit a lifetime high of 8,330.75, up 1.98%, or 161.55 points. Photo: Mint

Mumbai: Benchmark equity indices rose to records for the second consecutive day on Friday, completing their best month since June, on expectations the government will unveil more economic reforms in the days to come.

Partly, the advance was in consonance with a rally in other Asian stock markets after the Bank of Japan boosted monetary stimulus, pushing the MSCI Asia Pacific Index up 1.3% in Hong Kong.

The BSE Sensex advanced for the fourth session in a row and closed 1.9%, or 519.5 points, higher at 27,865.83 points. The National Stock Exchange’s Nifty gained 1.87%, or 153 points, to 8,322.20 points. Both are lifetime closing highs.

“We saw considerable short-covering in the last couple of sessions, with the event risk of Fed meet behind us, and on optimism in regional markets as well," said Rikesh Parikh, vice-president of equities at Motilal Oswal Financial Services Ltd. “People are sort of convinced that this government will take concrete policy action, after seeing their recent moves."

Short-covering is the practice of buying back a stock that had earlier been sold short on expectations that it would head lower.

The Sensex, India’s benchmark stock index, completed its best month since June, adding 4.6% in October. The index gained 3.8% this week, the most since the first week of June.

Since coming to power in May, the Narendra Modi government has decontrolled diesel prices and relaunched the bank transfer of cooking gas subsidy. It has eased rules on foreign investment in the construction sector and unveiled business-friendly labour regulations to push manufacturing growth.

“The government has announced a slew of steps to boost growth, company earnings have been good and falling crude oil prices are providing strong tailwinds," said Sadanand Shetty, a senior fund manager at Taurus Asset Management Co., which has $720 million in assets. “It is a period of Goldilocks. Everything is falling in place."

Since the beginning of this year, the Sensex has risen 31.5%, making BSE the best-performing major market in the world. Foreign institutional investors have bought a net of $13.41 billion from local equity markets so far, although they turned net sellers in October.

Domestic institutional investors have been net sellers of Indian equities to the tune of 28,218.02 crore so far this year, but they invested a net of 4,390.24 crore in the asset class in October, the most since August 2013.

“The re-initiation of reforms is providing a boost to the market," said Dipen Shah, head of private client group research at Kotak Securities Ltd. “Strengthening US economic growth, relief that US interest rates are not going to rise anytime soon, today’s development in Japan, are all adding to the already-positive sentiment."

On Friday, Deutsche Bank AG set a Sensex target of 29,000 for March 2015, citing intensifying policy action. “We expect the Modi government to capitalize on an approaching 11 month election-free window to move ahead decisively on its reform agenda," Deutsche Bank analysts Abhay Laijawala and Abhishek Saraf wrote in a research note.

On Thursday, credit ratings agency Moody’s Investors Service said the Indian government and the Reserve Bank of India’s recent economic, fiscal and financial measures will, if implemented, sustain higher economic growth and address some of the constraints on India’s sovereign credit profile.

Among the sectoral indices, the BSE Capital Goods index was the top gainer on Friday, advancing 2.7%. BSE Oil and Gas, and IT indices rose 2.2% and 2%, respectively. The BSE Consumer Durables index was the only sectoral index that closed lower, losing 3.2%.

Ravindra Sonavane and Bloomberg contributed to this story.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 31 Oct 2014, 09:55 AM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App