The benchmark Sensex at Bombay Stock Exchange recovered 330 points or 0.97 per cent on Thursday to close at 34,413 after falling for seven successive trading sessions where it lost an aggregate of 2,200 points or 6 per cent. The broader Nifty at the National Stock Exchange too rose 0.96 per cent to close at 10,576.8. The gains in India came amidst a mixed movement in global markets and on the back of strong investment by domestic institutional investors.
On Thursday, while the domestic institutional investors pumped in a net of Rs 2,373 crore, the foreign portfolio investors sold Indian equities worth Rs 2,297 crore.
Over the last four trading sessions that have been marred by global concerns around inflation and interest rate hike in the US and imposition of long term capital gains tax in India on equity gains, the DIIs have invested heavily even as FPIs made a sharp exit. During the four trading sessions this week, while the FPI sold Indian equities worth a net of Rs 6,099 crore, the DIIs have invested a net of Rs 5,698 crore providing some strength to the Indian markets.
During the day while Nikkei in Japan (1.1%) and Hang Seng in Hong Kong (0.4%) witnessed gains, Shanghai Composite in China fell 1.4 per cent during the day. In Europe, the Dax in Germany and FTSE in UK were down by 1 per cent and 0.8 per cent respectively during afternoon trading hours. An emergence of value-buying in recently battered banking counters as also pharma and IT stocks revived optimism on domestic bourses. Market participants said that investor sentiments got a boost from improved outlook on economic growth and a decline in crude oil prices.
“Domestic earnings positivity and optimism in Asian peers led Indian market higher after RBI’s status quo stabilised markets. However, investors will continue to keep a watchful eye on global volatility, with Europe continuing to see vulnerability ahead of BOE rate decision,” said Anand James, chief market strategist, Geojit Financial Services. On Wednesday, the Reserve Bank projected growth rate at 7.2 per cent for the next financial year following stability around rollout of GST stabilises and improvement in credit offtake. In its 6th bi-monthly policy review, the RBI on Wednesday maintained its status quo on the policy front, retaining the repo rate at 6 per cent and the reverse repo at 5.75 per cent.
Sun Pharma emerged the biggest gainer on Thursday as the stock surged 6.32 per cent. Dr Reddy’s too gained 3.18 per cent. Other major gainers among Sensex companies include SBI, Infosys, Axis Bank, Tata Steel and HDFC LTD among others.
Among the sectoral indices, the healthcare index at BSE witnessed the highest gain of 2.9 per cent on Thursday. Cipla and Ajanta Pharma too gained 7.8 per cent and 5.3 per cent respectively.
Losses in Power Grid, NTPC, Tata Motors, ONGC, Adani Ports, ITC Ltd and Bharti Airtel, however, squeezed the upside.
Other sectoral indices that witnessed gains include realty (2.51 per cent), Telecom (1.45 per cent), Capital Goods (1.44 per cent), teck (1.41 per cent) and IT (1.40 per cent) among others. A similar pattern showed up in broader markets, where the small-cap and mid-cap indices rose by 2.25 per cent and 1.82 per cent.