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Led by automobile and telecom stocks, the benchmark Sensex on Friday rose to a new 16-month high of 28,532.11 amidst positive global cues ahead of US jobs data and strong sales by domestic auto manufacturers.
The 30-share Sensex opened on a strong note and advanced further as buying pace gathered momentum to hit a high of 28,581.58, before settling 108.63 points, or 0.38 per cent, higher at 28,532.11, its highest level since April 16 last year when it had closed at 28,666.04. The NSE Nifty gained 35 points or 0.40 per cent to close above the 8,800-mark for the first time since April 13, 2015 at 8,809.65. It shuttled between 8,824.10 and 8,768.20.
The rupee continued its robust performance against the US currency for the fourth straight day, ending higher by 13 paise at 66.82 on heavy dollar selling. On weekly basis, the domestic currency recovered 24 paise, or 0.36 per cent after a three-straight weekly slide.
Investors remained cautious awaiting US jobs data to be released later in the day which would give cues about whether the Federal Reserve goes for early rate hike or not. On a weekly basis, the Sensex climbed 749.86 points or 2.69 per cent and the NSE Nifty soared 237.10 points or 2.76 per cent, biggest weekly gains in over two months.
Anand James, Chief Market Strategist, Geojit BNP Paribas Financial Services, said, “with an eye on monsoon driven growth in the next quarters, markets largely ignored weak Q1 GDP figures, but with cement stocks, which were among the leaders yesterday, coming under pressure from the Competition Commission of India (CCI) directive, stocks stayed on the back foot. Cement stocks recovered later, and PMI at 13 month high shored up the sentiment.”
According to James, with Reliance Jio’s AGM revealing aggressive product launch, the telecom sector in Nifty fell 7.38 per cent dragging the Index down. Meanwhile, weak oil and upcoming nonfarm payrolls figures kept global markets on a watch mode.
Maruti Suzuki emerged as top gainer in the auto segment, surging 1.98 per cent to Rs 5,158.50 after the company yesterday posted a 12.2 per cent rise in total sales for August. Auto major Mahindra and Mahindra rose 1.17 per cent to Rs 1,468.85 after the company reported a 14 per cent rise in total sales to 40,591 units in August. Hero MotoCorp, country’s largest two-wheeler maker’s stock, gained 0.89 per cent. Tata Motors gained 1.13 per cent to Rs 549.80 after its sales in August jumped 6 per cent to 43,061 units.
Telecom stocks such as Bharti Airtel, Idea Cellular and Reliance Communication staged a comeback after Thursday’s plunge. Bharti rose by 2.66 per cent and Idea 0.42 per cent. Telecom stocks suffered huge losses in Thursday’s trade after Mukesh Ambani announced the launch of much-talked about Jio 4G service, offering free voice calls and national roaming.
“Markets ended the week on a strong note with gains of about 2.7 per cent for the week. The gains were secular with most sectors participating in the rally. Markets rose in sympathy with the uptrend in global markets, ahead of the important non-farm payroll data due on Friday in the US,” said Dipen Shah, Senior Vice President, Kotak Securities. “Markets will react to the interest rate decision by the US Fed in its ensuing meeting in September. Crude prices will also continue to impact the market sentiment, ahead of the meeting of OPEC members in September-end. There are expectations that an output freeze could be decided by the members in that meeting to stem the weakness in crude prices,” he said.