Sensex races past 25,000 on unabated buying

Our Bureau Mumbai | Updated on June 05, 2014 Published on June 05, 2014


Thrust on reforms, favourable monsoon conditions boost sentiment

Equities continued their dream run on Thursday with the Sensex crossing the 25,000-mark milestone, after slipping into the red during early trade.

Sentiments were lifted on the India Meteorological Department’s report of the monsoon setting in across the country over the next 24 hours, coupled with optimism about Prime Minister Narendra Modi’s thrust on reforms and a strong policy framework.

The BSE Sensex closed at 25,020, up 214 points or 0.86 per cent from its previous close, while the Nifty ended the day at 7,474, up 72 points, or 0.97 per cent, from its previous close.

The banking index was the only loser among the BSE sectoral indices, while the small- and mid-cap indices outperformed the benchmark Sensex, closing higher by 1.42 and 1.01 per cent, respectively. Strong performance by metals, oil and gas, and power sectors also supported the rally.

The metals index led the rally, closing 33 per cent higher.

FII investments

Foreign institutional investors’ optimism regarding the Indian market continues. They have already pumped in over $8 billion (or about ₹50,000 crore) so far this year into Indian equities.

Amar Ambani, Head of Research, IIFL Holdings, said: “After taking a breather in the previous trading session, the Indian equity market bounced back with the Sensex, Nifty and the CNX mid-cap index all closing at fresh, life-time highs on Thursday. Sentiment got a tremendous boost on reports that the Met has found conditions favourable for the onset of monsoon in the next 24 hours. ”

Dipen Shah, Head, Private Client Group Research, Kotak Securities, added: “Optimism on the Budget, as well as future growth, remains high. Participants are ready to give higher valuations to beaten-down mid-cap stocks.”

Published on June 05, 2014
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