Bouyant Indian markets rallied to a fresh high on Monday, propelled by positive macro indicators and marked progress on coronavirus vaccines. The Sensex hit the 48,000 mark for the first time ever on widespread investor hopes of an economic recovery.
The BSE Sensex ended at 48,176.80,up 307.82 points or 0.64%. The Nifty closed at 14,132.90, up 114.40 points or 0.82%.
Shares in other markets in the Asia Pacific also gained. Mainland Chinese stocks and South Korea’s Kospi jumped 1-2.5%. Japanese shares, however, lagged the broader gains in the region, with the Nikkei falling 0.68%. Markets in Japan were weak on concerns that the government was considering a state of emergency for capital Tokyo. Japan said it would consider declaring a state of emergency for the Greater Tokyo metropolitan area amid rising cases of coronavirus, casting fresh doubt over whether it can push ahead with the Olympics and keep economic damage to a minimum, according to Reuters.
“World stock markets hit record highs on Monday, the first trading day of the new year, as investors hoped the rollout of vaccines would ultimately lift a global economy ruined by the pandemic. The post holiday upbeat mood in India should sustain for 1-2 sessions,” Deepak Jasani, head of retail research, HDFC Securities said.
On Sunday, India’s drugs regulator approved for emergency use two coronavirus vaccines, one developed by AstraZeneca and Oxford University and the other by Bharat Biotech. Also, in December, passenger and commercial vehicles wholesales were above analysts estimates, whereas two-wheeler and tractor wholesales were in line, suggesting demand recovery. “Overall, investor sentiments have been lifted after the emergency approval given to the two vaccines,” said Naveen Kulkarni, chief investment officer, Axis Securities. Kulkarni said mid- and small-cap stocks will continue to outperform this year. His themes for the year are digital, telecom, pharma, rural, staples and consumer discretionary. “Apart from Q3 earnings, the budget will be key,” Kulkarni added.
{{/usCountry}}On Sunday, India’s drugs regulator approved for emergency use two coronavirus vaccines, one developed by AstraZeneca and Oxford University and the other by Bharat Biotech. Also, in December, passenger and commercial vehicles wholesales were above analysts estimates, whereas two-wheeler and tractor wholesales were in line, suggesting demand recovery. “Overall, investor sentiments have been lifted after the emergency approval given to the two vaccines,” said Naveen Kulkarni, chief investment officer, Axis Securities. Kulkarni said mid- and small-cap stocks will continue to outperform this year. His themes for the year are digital, telecom, pharma, rural, staples and consumer discretionary. “Apart from Q3 earnings, the budget will be key,” Kulkarni added.
{{/usCountry}}The vaccine progress has also driven investor interest for the Indian currency. The Indian rupee hit a fresh four-month high on Monday to strengthen past the 73-per-dollar mark. During the day, the local currency hit a high of ₹72.90 a dollar, a level last seen on 2 September. The rupee has gained in seven out of eight sessions and advanced 1.2% during this period. It closed at 73.02, up 0.13% against the dollar.