Sensex, Nifty on record breaking spree on fresh reforms

Buying in FMCG, auto, IT and pharma shares mainly kept the market tempo upbeat while realty, metal and power shares attracted profit booking, restricting the sensex rise.

PTI| Updated: Aug 30, 2014, 16:26 PM IST

Mumbai: Continuing its upward spring for the third straight week, both the key indices, Sensex and Nifty, register their fresh closing peak during the truncated week under review on the back of sustained capital inflows amid fresh reforms at the domestic front.

The BSE and the NSE were closed on Friday, August 29, for "Ganesh Chaturthi".

The S&P BSE benchmark Sensex resumed better and moved in a range of 26.674.38 --historical intra-day high-- and 26,314.89 before concluding the week at 26,638.69, a net rise of 219.14 points or 0.83 pct. In straight three weeks, it has zoomed by 1,309.55 points or 5.17 pct.

The broad-based 50-issue CNX Nifty of the NSE also gained 41.15 points or 0.52 pct to log its new closing peak of 7,954.35. It had registered an intra-day high of 7,968.25.

The market also got support on hectic short-coverings as the August derivatives series concluded on Friday.

Buying in FMCG, auto, IT and pharma shares mainly kept the market tempo upbeat while realty, metal and power shares attracted profit booking, restricting the sensex rise.

Indian markets shrugged off the Supreme Court's ruling on coal block allocations, though it triggered a wave of selling, especially in metal shares.

The Court on Monday held that all coal block allocations made since 1993 till 2010 before pre-auction era during previous NDA and UPA regimes have been done in an illegal manner by an "ad-hoc and casual" approach "without application of mind".

As a result, metal stocks like Jindal Steel, Hindalco, Bhushan Steel, Tata Steel, Sesa Sterlite, JSW Steel, Hindustan Zinc, SAIL and NMDC closed down.

Positive global cues, lower crude oil prices and sustained foreign fund inflows helped the key indices to hit their fresh record highs in the week.

Heavy selling was initially seen after Competition Commission of India (CCI) imposed Rs 2,545 crore fine on 14 car makers, including Tata Motors, Maruti Suzuki and Mahindra & Mahindra, for violating trade norms in the spare parts and after services market.

However, short-coverings during the week on expiry of August contract on Thursday aided the smart recovery in auto stocks also, traders said.

Shares from realty, metal and power sectors attracted profit-booking while FMCG and pharma were in demand as investors tried to seek safe refuge, they added.

Hopes of a fresh Eurozone stimulus and upbeat US economic data also buoyed the sentiment.

Defence stocks were in the limelight and rose by up to 20 percent today after government notified increase in FDI limit to 49 percent through approval route in the sector.

Sentiments also remained optimistic after Oil Ministry said it will seek Cabinet nod for freeing diesel prices after retail rates achieve parity with global levels, and has proposed to cut subsidy payout by upstream firms like ONGC and Oil India by half.

Brokers said investors continued to focus on a series of steps taken by the Modi government to boost the economy and attract FDI.

Meanwhile, gross domestic product (GDP) April-June quarter bounced back to record a growth rate of 5.7 percent -- highest in the past two-and-half years -- against 4.7 percent in the same period last year.

The Sensex and the Nifty have gained about 26 percent this year so far, the most among big global indices.

Rail stocks were in demand on Thursday after government notified liberalised FDI norms for the sector. Shares of Texmaco Rail, Titagarh Wagons and Kalindee Rail Nirman rose.

In all, 16 stocks out of the 30-share Sensex pack ended in the green while others settled in the red.

BHEL was the top gainer from the sensex pack with a rise of 5.80 pct followed by HUL 5.24 pct, Dr Reddy's Lab 4.42 pct, Cipla 3.39 pct, ITC 3.33 pct, Hero MotoCorp 2.92 pct, HDFC 2.80 pct, GAIL India 2.60 pct, TCS 2.56 pct, Tata Motors 2.52 pct, ICICI Bank 1.23 pct, M&M 1.35 pct, ONGC 1.94 pct, Wipro 1.53 pct and Maruti Suz 1.06 pct.

However, Tata Power dipped by 7.11 pct, Hindalco by 6.56 pct, SSLT 4.96 pct, Tata Steel 4.47 pct and SBI 2.50 pct.

Among the S&P BSE sectoral indices, FMCG firmed up by 3.24 pct, auto 1.52 pct, IT 1.38 pct and HC 1.27 pct while Realty dipped by 5.21 pct, Metal 4.64 pct and Power 3.05 pct.

The total turnover at the BSE and NSE dropped to Rs 11,629.67 crore and Rs 64,060.11 crore respectively due to shortened week from Rs 14,981.33 crore and Rs 79,839.99 crore last week.