Sensex within kissing distance of 50,000-mark

Our Bureau | Updated on January 19, 2021

On Tuesday, the index gained 834 points, or 1.72 per cent, to close at 49,400

As bullish bets mount ahead of the Union Budget presentation on February 1, the Sensex resumed its march towards the 50,000-mark. On Tuesday, the index gained 834 points, or 1.72 per cent, to close at 49,400. This is the best single-day gain in four months.

Since October, foreign portfolio investors (FPIs) have net purchased stocks worth nearly $20 billion in the cash segment. Global markets are showing no signs of weakness as Joe Biden, the US President elect, has announced a major spending plan that could let loose more dollars into the markets.

Analysts believe the upside will continue for the index even after it crosses the ballpark level.

During the intra-day trading on Tuesday, the Sensex gained 936 points. The broader index Nifty gained 1.68 per cent, or 238 points, to 14,521. Bajaj Finserv, Bajaj Finance, Sun Pharma and HDFC Bank were among the top gainers that rose between 3- 6 per cent. Broader market stocks outperformed Sensex and Nifty . The S&P BSE MidCap index gained 2.31 per cent and the Small-cap gained 1.66 per cent. Index heavy weight stock Reliance Industries gained 1.65 per cent to close at ₹2,016.

“Market is set up for a further pre-budget rally. If the US dollar bounce is over, it could fuel a continuous rally in emerging markets. For the Nifty index, 14,900 before the budget day cannot be ruled out," said Rohit Srivastava, founder and strategist, IndiaCharts.

In the current month so far, FPIs have purchased stocks worth ₹17,552 crore or more than $2.35 billion in the cash segment. On the derivatives, FPIs have been sellers to the tune of ₹3,304 crore but remained buyers of stocks futures worth ₹1,079 crores.

"The result season has started well, giving encouraging signs. The vaccination drive is progressing well. Also, the global cues have been positive, with expectation of a large fiscal push in the US. The overall sentiment is quite bullish. We expect that the market will now take its next major cue from the budget. The multiple expansion-driven returns will ease out and returns will be linked more to growth from here on," said Mohit Ralhan, Managing Partner & CIO, TIW Private Equity.

Published on January 19, 2021

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