Sensex surges 690 points as FPIs pour in ₹6,000 crore

Our Bureau Chennai | Updated on January 08, 2021

IT, auto stocks stoke rally

There was no slowdown in bulls charge, as the benchmarks ended at record highs on Friday, with foreign portfolio investors pumping in a net ₹6,029.83 crore, according to provisional data from the exchanges. Information technology and automobile stocks lead the rally for benchmarks.

The BSE Sensex closed at 48,782.51, up 689.19 or 1.43 per cent, while the NSE Nifty 50 closed at 14,347.25 , up 209.90 or 1.48 per cent. The market capitalisation of BSE-listed companies zoomed to a fresh lifetime high of over ₹195.66 lakh crore on Friday. During the day, the BSE Sensex hit an all-time high of 48,854.34 and the Nifty 14,367.30.

As many as 473 stocks hit the upper circuit on the BSE, while 481 hit their 52-week highs.

“The rally led by IT and auto stocks guided the domestic market to discover new highs, which was due to improved quarterly outlook,” said Vinod Nair, Head of Research at Geojit Financial services.

Most sectoral indices recorded healthy gains through the day, led by IT and auto. S&P BSE IT index closed at 25,835.98, up 886.67 or 3.55 per cent. S&P BSE Auto gained 716.85 or 3.37 per cent to reach 21,997.89.

Weekly gains

Rusmik Oza, Executive Vice President, Head of Fundamental Research at Kotak Securities, said the start of calendar year has been good with Nifty-50 and BSE Sensex gaining 2.3 per cent and 1.9 per cent, respectively, this week. The broader indices have performed even better than the benchmark indices. The Nifty MidCap 100 Index and BSE SmallCap Index have gained 5.2 per cent and 2.7 per cent, respectively, this week. “On the back of rising metal prices and good Q3 earnings expectations, the BSE metal Index rose by 9 per cent. Other sectors that delivered healthy returns this week are telecom (up 5.9 per cent), utilities (up 5 per cent) and IT services (up 5.6 per cent).

“Support from strong global indices also helped raise domestic market sentiments. The official certification of Biden’s presidency by the US Congress and easing of the political unrest as Trump promised a smooth transition of power, have created an upbeat movement in the western market,” Nair added.

S Ranganathan, Head of Research at LKP Securities, said: “An array of high-quality midcaps across sectors registered smart gains as mood remained buoyant through the day.”

The focus of the market will now shift to third quarter earnings, analysts said.

The market draws its strength from the relatively better economic fundamentals, resulting from the easy liquidity conditions and the accommodative stance of fiscal and monetary policy. Any challenges to the sustainability of the economic rebound would pose a problem for the markets, said Joseph Thomas, Head of Research - Emkay Wealth Management.

Published on January 08, 2021

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