The Nifty on Thursday reclaimed the 15000 mark and the Sensex gained 258 points as positive global cues led to renewed buying in the heavyweight counters.
Analysts said that with the expiry of the forward and options (F&O) contract for the month, the stage was set for stocks to resume their climb amid news of the government planning more reform measures and the economy being on the mend. They, however, caution that adverse news on Covid-19 cases could stem the upside.
Thursday’s rally came after a tough Wednesday for investors as the NSE stopped trading for four hours because of a technical glitch.
In Thursday’s trading, the benchmark indices remained positive as global stocks posted good gains. PSU shares hogged the limelight as the Centre said it was committed to privatising all PSUs barring the bare minimum in four strategic sectors. This led to the NSE CPSE index rallying 4.43 per cent. Gains in this index were led by Coal India followed by NBCC.
The Sensex closed 0.51 per cent higher at 51039.31. Similarly, the broader NSE Nifty rose 115.35 points or 0.77 per cent to 15097.35.
Market-economy gap
Sebi chairman Ajay Tyagi on Thursday acknowledged the systemic risk concerns raised by the RBI and the Financial Stability Board over a disconnect between the financial markets and the real economy, but said this is a global phenomenon.
“Typically, stock markets have been the barometers of the economy and move in the direction in which the economy moves or is expected to move. However, after the onset of pandemic, several institutions have raised concerns of an increasing disconnect of financial markets with the real economy,” Tyagi said.
“However, similar trends have been there across many global markets,” Tyagi said, speaking at an NISM event.
Explaining the series of events leading to the shutting down of trading, the NSE said it has multiple telecom links with two service providers to ensure redundancy and the two telcos informed it about "instability of all their links", as per a statement. This instability resulted in an impact to the online risk management system, which is configured in a 'high availability' mode, it said, adding that there was no impact to trading.
"Domestic markets added strength on yesterday’s rally supported by positive F&O monthly roll-over and robust global market. Small and mid-cap stocks continued its out-performance over the benchmark indices. World equity market rebound after getting assurance from central banks, importantly the Fed, that good liquidity will be maintained, in spite of being under pressure of rising inflation, since the economy is still well below the pre-Covid standpoint’’ Vinod Nair, Head of Research at Geojit Financial Services said.
