After a splendid September, the BSE benchmark Sensex started October on a spectacular note today, rallying by 376 points to its highest level in nearly 32 months on the back of record inflows from overseas funds.
Rising for the second straight session, the Bombay Stock Exchange’s 30—share index settled higher by 375.92 points, or 1.87 per cent, at 20,445.04 —— its best level since January 14, when it had closed at 20,728.05.
In a similar fashion, the wide—based 50—share Nifty index of the National Stock Exchange zoomed 1.88 per cent to 6,143.40, with the maximum contribution coming from realty, metal, consumer goods and IT stocks.
During the week, the Sensex posted a net gain of 2 per cent, extending its rising streak for the fifth straight week.
In September, the Sensex rose by over 10 per cent.
Analysts said that sustained FII buying in local equities and firm global cues supported the rally. FIIs have infused a record USD 18.3 billion in Indian stocks so far this year, driving the Sensex 17 per cent higher.
“Huge capital inflows from the US and European markets are supporting the rally in domestic markets. Overseas investors see better returns from emerging economies like India and China as most advanced economies are in a low interest rate regime,” Religare Securities Executive V—P Rajesh Jain said.
Index heavyweight Reliance Industries Ltd, which has been beaten—down in the past few trades, bounced back smartly and ended 2.04 per cent higher at Rs 1,006.45.
Metal stocks were shining on Dalal Street, with Sterlite rising 5.13 per cent (the most in the Sensex pack), Hindalco 3.81 per cent, Jindal Steel 3.42 per cent and Tata Steel 2.46 per cent.
Analysts said increased crude oil prices and near record gold rates in overseas markets boosted commodity firms.
Auto stocks were in top gear on robust vehicle sales in September. M&M jumped 2.91 per cent, Tata Motors 1.96 per cent and Maruti Suzuki 2.89 per cent. However, Hero Honda saw some selling pressure and ended 0.43 per cent lower.
“There was more demands for cars and motorcycles during September ahead of the festive season and the figures boosted the sentiment on the Street,” Consortium Securities Assistant Vice—President Vishwesh Choudhary said.
IT stocks were also in high demand and Infosys rose 2 per cent, TCS 4 per cent and Wipro 2.81 per cent.
DLF zoomed 2.78 per cent, Jaiprakash Associates 2.73 per cent, BHEL 4.29 per cent and L&T 2.65 per cent.
Some brokers were also of the view that the sentiment turned firm on Dalal Street following the clarity over the Ayodhya title suit. Yesterday, the Allahabad High Court ruled by majority that the disputed land in Ayodhya should be divided into three parts between the Sunni Waqf Board, Nirmohi Akhara and the party for ‘Ram Lalla’
“The high court verdict matters for all and market cannot be seen in isolation from the society,” Choudhary added.
The trading sentiment was also firm following a healthy rollover in the derivatives segment. Yesterday was the last day for settlement of F&O contracts.
Asian stocks rose, driving the MSCI Asia Pacific Index to its fifth consecutive weekly advance, after the Purchasing Managers Index of China’s manufacturing sector rose to 53.8 per cent in September, up 2.1 percentage points from August.
Among the major financial stocks, ICICI Bank rose 2.2 per cent, HDFC 1.63 per cent, HDFC Bank 0.75 per cent and SBI 0.87 per cent.
All the sectoral indices settled in the green. In the BSE —30 pack, 27 stocks closed with gains, while 2 scrips lagged behind and ended in the red. RCom remained unchanged, while rival Bharti Airtel fell by 0.21 per cent.
