June 3, 2016 1:38:06 am
Rebounding from earlier losses, domestic stock markets on Thursday hit a seven-month high as stocks led by Coal India rose on firmer commodity prices and hopes about a revival in the economy.
After moving between 26,641.02 and 26,885.16, the Sensex settled 129.21 points or 0.48 per cent higher at 26,843.14. The NSE Nifty ended 39 points, or 0.48 per cent, higher at 8,218.95 after moving in a range of 8154.75 to 8,229.50.
The market had gained some 46 points in Wednesday’s trade on robust GDP numbers and core infrastructure sector growth. A significant recovery in the last hour of trading and a bounce back in the rupee wiped off earlier losses, analysts said.
The rupee made a smart recovery against the US currency after a three-day straight fall and ended higher by 16 paise at 67.29 on fresh bouts of dollar selling by banks and exporters.
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The sentiment remained upbeat on account of strong macro-economic data, encouraging Q4 earnings and a forecast of good monsoon rains this year. According to the latest government data, India’s GDP grew 7.9 per cent in the January-March quarter of 2015-16, taking the overall economic growth to a five-year high of 7.6 per cent for the entire fiscal. The production of eight core sectors grew 8.5 per cent in April on the back of pick up in output of refinery products, fertilisers, steel, cement and electricity.
Shreyash Devalkar, fund manager (Equities), BNP Paribas Mutual Fund, said, “It was an interesting day on the bourses today, as key benchmark indices languished in negative territory for most of the day before shrugging off all losses and climbing into the positive zone in the last 90 minutes of trade. Markets were given a leg up by buying in metal and banking stocks.”
The metals index on the National Stock Exchange closed the day with gains of nearly two per cent while the media and banking indices gained closed to one per cent for the day. Among the losers were IT and pharma stocks, which came under selling pressure.
Nifty gained nearly half a per cent on Thursday and settled above the psychological mark of 8200, thanks to late hour buying in index majors. “Mixed global cues and cautiousness ahead of OPEC meet pushed the participants slightly on the back foot but buying activities in banking, auto and other heavyweights completely turned the table in last hour and aided index to close around the day’s high,” said Jayant Manglik, president (retail distribution), Religare Securities.
Coal India led the rally and climbed 3.20 per cent. Vinod Nair, head of Research, Geojit BNP Paribas Financial Services, said, “after a tepid start, the market accelerated in the second half as the global market extended gain due to the rise in oil price ahead of the OPEC meet. Additionally, the outcome from the ECB meet is likely to be a status quo but the outlook for inflation will be seriously monitored by the investors for any uptick in economy.”
On the global front, the dollar slipped to a fresh two-week low against a basket of major currencies after a mixed bag of US economic data once again raised concerns over whether the Federal Reserve will hike interest rates in June amid some caution ahead of US jobs report this weekend.
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