The Sensex streaked past the 79000 mark on Thursday — totting up an 8300 point gain in just 16 sessions after it slouched to a low of 70243 points on June 4, the day of the poll results.
The momentum which extended to the fourth straight session saw the 30-share Sensex rallying 568.93 points to end at a closing peak of 79243.18 after jumping 721.78 points during intra-day trades to 79,396.03.
On the NSE, the Nifty closed at an all-time high of 24044.50, marking a gain of 175.70 points after vaulting 218.65 points to touch 24087.45.
“The index had recovered all of it election day losses in just three trading sessions. This must have been one of the fastest recovery in the history of Indian capital markets which can mainly be attributed to fund flows,” Apurva Sheth of Samco Securities said.
“The fund flow data of foreign portfolio investors (FPIs) from Sebi shows that they have been buyers in the last 12 sessions from June 10-26. They have pumped in nearly ₹32,087 crore in Indian equity markets.”
“Domestic institutions have pumped in ₹20,002 crore in the same period. Retail investors on the election day alone bought stocks worth ₹21,179 crore.”
``With bulls sitting firmly in the driving seat and multiple factors such as liquidity, seasonality and momentum in their favour, one can expect the rally to continue in July with a target of 24,500 on the Nifty,’’ he said.
Apart from the liquidity element and expectations of robust economic growth, optimism of more reforms in the budget was another reason for the indices hitting historic highs.
Hopes on this front were rekindled by President Draupadi Murmu’s speech in Parliament on Thursday — in which she said along with major economic and social decisions, “many historic steps will also be seen in this budget’’.
``The pace of reforms will be further accelerated in tune with the aspirations of people of India for rapid development,” she said.
This market is running on steroids; but the question is whether the rally will sustain.
Experts feel that equities could take a break after the market digests the budget.
While stocks or pockets that have seen a sharp rally could see a correction, subsequently the focus will turn to actions of central banks such as the Federal Reserve which is expected to start cutting rates by September.
“The benchmark indices exhibited bullish momentum, buoyed by expected revival in the IT sector and consolidation in the cement industry. However, the broader market remained sideways due to valuation concerns and FII selling owing to rising US bond yields,” Vinod Nair of Geojit Financial Services said.
UltraTech, NTPC and JSW Steel were among the top gainers.
In the broader market, the BSE midcap gauge climbed 0.17 per cent while smallcap index declined 0.57 per cent.
Among the indices, power jumped 1.74 per cent, IT rallied 1.65 per cent, while teck (1.59 per cent), utilities (1.29 per cent), telecommunication (1.18 per cent) and commodities (0.82 per cent) advanced.
