Market gets a 259-pt lift as economy shows traction
Shaking off Brexit jitters, market today rallied nearly 216 points on the back of a string of government measures aimed at reviving the economy and talk that the GST Bill may be passed in the upcoming monsoon session of Parliament.business Updated: Jun 30, 2016 19:03 IST
Stocks on Thursday wiped off their Brexit losses suffered last week by soaring over 259 points, in line with a global rally, on improving prospects of the economy to close just below the 27,000-mark.
This is the strongest quarterly show of the market in two years since Prime Minister Narendra Modi’s historic election win in 2014.
The broader NSE Nifty scaled the 8,300 mark for the first time this year.
Of late, the government has taken a clutch of steps to turn around the economy as it relaxed FDI rules, cleared pay hike for its employees and approved a new mineral exploration policy and model law on shops and establishments. All this cheered investors, dealers said.
Covering-up of short positions on expiry of June derivative contracts at the end of the session helped too.
The changed arithmetic in the Rajya Sabha gave investors more reasons to feel buoyant about the prospects of the GST Bill that the government says may be passed in the upcoming monsoon session of Parliament.
Good progress in the monsoon so far also came as a big positive.
The Sensex closed higher by 259.33 points, or 0.97 per cent, at 26,999.72. The gauge had gained 342.68 points in the previous three sessions.
Also, the 50-share NSE Nifty regained the 8,300-mark and settled at 8,287.75, up 83.75 points, or 1.02 per cent.
Auto stocks and consumer durables stocks remained in the limelight as companies looked forward to strong growth in sales this year as a result of implementation of the 7th Pay Commission recommendations.
An appreciating rupee against the US dollar provided more support.
Easing worries about Britain’s decision to leave the European Union and its impact on the global economy came as good news for Asian and London markets.
Globally, Asian markets ended higher. Hong Kong’s Hang Seng rose 1.75 per cent, Japan’s Nikkei 0.06 per cent but Shanghai Composite Index shed 0.07 per cent. European markets too advanced as Paris was up 0.27 per cent.
As many as 28 scrips out of 30-share Sensex pack ended higher.
Meanwhile, foreign portfolio investors (FPIs) net bought shares worth Rs 102.91 crore during Wednesday’s trading session, as per provisional data.
Dr Reddy’s emerged as the top gainer, by rising 3.38 per cent, followed by NTPC (3.17 per cent).
Other major gainers that contributed to the rally were Axis Bank, Tata Motors, Tata Steel and Bharti Airtel.
Among S&P BSE sectoral indices, realty rose the most by 2.39 per cent, followed by power 2.19 per cent, metal 1.74 per cent, banking 1.46 per cent, consumer durables 1.44 per cent, auto 1.39 per cent, capital goods 1.21 per cent, PSU 0.99 per cent and FMCG 0.89 per cent.
In the broader markets, the mid-cap index climbed 1.26 per cent while small-cap ended 0.94 per cent higher.