Indian markets registered a strong rally on Tuesday with Sensex nearing 58,100 and Nifty 50 climbing to 17,280 levels. All sectoral indices saw gains with banking, capital goods, metals and IT stocks emerging as the best performers. Midcap stocks outperformed smallcap stocks, however, there was significant buying in both the baskets. Domestic equities tracked positive global cues as they prepare for Q2 earnings for FY13. The Indian currency appreciated against the dollar in the forex market as the greenback fell while Treasury yields retreated. Foreign fund inflows also picked up. Meanwhile, crude oil prices rose ahead of the OPEC+ meeting where production cuts are expected. Due to the bullish trend, the wealth of the investors increased more than 5.66 lakh crore in 1 day.
Sensex It closed at 58,065.47, up 1,276.66 points or 2.25%. The benchmark had touched an intraday high of 58,099.94.
Meanwhile, Nifty 50 climbed 386.95 points or 2.29% to end at 17,274.30. The benchmark has touched the day’s high at 17,287.30.
On the BSE, in terms of sectoral indices, the Bankex index rose 1,188.54 points, while the IT and capital goods index rose 728.85 points and 713.98 points. The metal index was up 612.06 points. Meanwhile, Bank Nifty rose 1,080.40 points on the NSE.
Mitul Shah, Head of Research at Reliance Securities said, “Indian stock market closed higher following positive global cues, while the market is gearing up for the upcoming. revenue weather.”
As on October 4, the market capitalization of BSE-listed firms was 2,73,92,739.78 crore — growing 5,66,318.84 crore from 2,68,26,420.94 crores of the previous day.
Vinod Nair, Head of Research, Geojit Financial Services, said, “The domestic market ended the day on a happy note, given the massive overnight rally in Wall Street and the upbeat domestic trading data released by banks. Unexpected slowdown in US manufacturing PMI gave. expect the US Fed to slow the pace of policy tightening. Following the suit, US bond yields fell along with the US dollar.”
At the interbank forex market, the Indian rupee strengthened on Monday as the dollar declined, while bond yields pulled back. The local unit closed at 81.52 against the US Dollar from the previous day’s close of 81.8725 against the US Dollar. The rupee had touched the day’s high of 81.3650.
Anindya Banerjee, VP, Currency Derivatives & Interest Rate Derivatives, Kotak Securities, said, “USDNR spot ended 35 paise lower at 81.52 on the back of a fall in the US dollar index and a fall in the US yield. The rally in stocks also helped.” Over the near future, US economic data such as ISM services and US NFP reports will provide direction. We expect a range of 81.20 and 82 on the spot.”
Further, Jatin Trivedi, VP Research Analyst, LKP Securities, said, “The rupee strengthened with a gain of 0.30% or 0.25p against the dollar where the dollar index hangs below $112, providing some relief to other currencies. Rupee rises on positive FII numbers. Losing ground in weak global bearish conditions minus India. Crude oil prices, however, showed positive movement which may dampen the ongoing enthusiasm as OPEC slowdown amid falling demand Will announce production cut. Expected to move up to Rs. 81.00-81.80.”
Meanwhile, inflows from foreign investors (FIIs) picked up in the first two days of October. FII jump on Tuesday 1,344.63 crore cumulatively in the equity market. On 3rd October, became net buyers with influx of FIIs 590.58 crores. Overall in the month of September, FIIs were net sellers, with outflows 18,308.30 crore from equity.
Further, Shah said, “the market suffered deep losses for the first nine months of the year as central bank officials have clearly clarified that interest rate hikes and monetary tightening will continue.”
Going forward, Shrikant Chauhan, Head of Equity Research (Retail), Kotak Securities said, “Short term market structure is positive, but due to temporary overbought position we may see range bound activity in near future. For traders Now, 17200 -17150/57800-57600 will be the key support zone while 17400-17425/58300-58400 will act as an important resistance zone for the index. Buying on intraday corrections and Selling on rallies is the ideal strategy for day traders Will be.”
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