E-Paper
Sensex hits a fresh high as investors bet on fast revival
The BSE Sensex hit the 53,000 mark for the first time ever before paring gains to close 14.25 points or 0.03% higher at 52,588.71. The Nifty rose 26.25 points or 0.17% to 15,772.75.
Indian stock markets scored a new high on Tuesday as investors bet on a faster recovery of the economy on increasing vaccination coverage and fall in coronavirus cases.
The BSE Sensex hit the 53,000 mark for the first time ever before paring gains to close 14.25 points or 0.03% higher at 52,588.71. The Nifty rose 26.25 points or 0.17% to 15,772.75.
“During early hours, Indian market traded strongly following yesterday’s rebound in western markets, which focused on economic recovery, partially offsetting concerns over a possible change in Fed policy in the future. Falling Covid infection rate along with ramping up of vaccination added colours to the broader market on hopes of faster economic recovery,” said Vinod Nair, head of research, Geojit Financial Services.
According to analysts, markets will keenly track the pace of progress in monsoons this year and how the economy recovers from Covid turmoil.
“Domestic markets would track global cues and the Reserve Bank’s step forward as the signs of rising inflation leads to fear of a sooner-than-expected tightening in global monetary policies, especially post the US Fed’s hawkish policy statement. However, good monsoon so far, gradual opening up of the economy and the pick-up in the pace of vaccinations provide support to the market,” said Siddhartha Khemka, head-retail research, Motilal Oswal Financial Services.
Lifting off of restrictions has been much swifter in a decentralized structure compared to last year’s emergence from a stringent nationwide lockdown, said QuantEco Research. “The administration of a record 8.5 million jabs on June 21, if sustained, will be the most potent support possible to economic recovery. While the trade-off between keeping guard up and regressing back into restrictions remains a threat in the near term, the pace of vaccinations can prove to be a real game changer,” it said in a note on June 22.
This month so far, foreign institutional institutes were net buyers of shares worth $1.74 billion while investing $8.33 billion for the calendar year so far. However, domestic institutional investors comprising mutual funds, insurance companies, pension funds and banks sold shares worth ₹2154.97 crore in June so far, and ₹12,123.34 crore for 2021 so far.
