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Equities Scale New Highs, Global Cues, Rupee Support Rally

After two consecutive weeks of losses, the Indian equity markets embraced the bulls as positive global cues and an appreciating rupee gave a fillip to investors' sentiments during the week ended Friday.


Updated:April 29, 2017, 5:49 PM IST
Equities Scale New Highs, Global Cues, Rupee Support Rally
The Bombay Stock Exchange (BSE) logo is seen at the BSE building in Mumbai. (Photo: Reuters)

Mumbai: After two consecutive weeks of losses, the Indian equity markets embraced the bulls as positive global cues and an appreciating rupee gave a fillip to investors' sentiments during the week ended Friday.

The key indices touched new record levels and closed the week's trade with gains of almost two percent each, even though they failed to hold on to their high levels due to selling pressure triggered by profit booking.

In the past week, the S&P BSE Sensex gained 553.1 points or 1.88 percent to close at 29,918.40 points. Similarly, the NSE Nifty rose by 184.65 points or 2.02 per cent to wind up the week's trade at 9,304.05 points.

On April 26, the Nifty closed at a new high of 9,351.85 points, while the Sensex touched a new closing high of 30,133.35 points.

During the week ended April 28, the BSE mid-cap index rose 2.14 percent, while the small-cap index advanced 1.35 percent, underperforming the Sensex.

"Indian equities surged in line with global stocks in the week ended Friday, April 28. After showing a fine upmove during early part of this week, the Nifty slipped during the later half of the week and ended 2.02 percent higher week-on-week basis," Deepak Jasani, Head - Retail Research, HDFC Securities, said.

"The Sensex closed the week below the psychological 30,000-level after surpassing that level in the course of its trading. The Nifty had hit its record closing high during the week."

On April 27, the NSE Nifty and the BSE Sensex recorded new intra-day highs of 9,367.15 points and 30,184.22 points.

Jasani pointed out that this week's upmove could also considered to be a "faster upward retracement of the last two weeks decline in one week".

According to market observers, during the week gone by, global stock markets were bolstered by relief over the first round of the French presidential election and signs of solid global economic growth in recent months.

"However, a long-awaited US tax-cut plan failed to inspire investors, though sentiment remained supported by global growth prospects and receding worries about political risks in Europe," said D.K. Aggarwal, Chairman and Managing Director, SMC Investments and Advisors.

"The domestic markets moved higher -- the Sensex crossed the 30,000 mark on Wednesday (April 26) to settle at all-time high levels -- on the back of consistent inflow from foreign and domestic investors coupled with sweeping reforms announced by the SEBI (Securities and Exchange Board of India)."

Figures from the National Securities Depository (NSDL) revealed that foreign portfolio investors (FPIs) invested in equities worth Rs 1,262.68 crore, or $195.62 million, during April 24-28.

Provisional figures from the stock exchanges showed that foreign institutional investors (FIIs) sold stocks worth Rs 1,925.39 crore, while domestic institutional investors (DIIs) bought scrip worth Rs 4,911.56 crore during the week.

On the currency front, the Indian rupee strengthened against the US dollar, appreciating by 36-37 paise to 64.24-25 from last week's close of 64.61.

"The US dollar/rupee recovered from the 20-month low (level) on buying by nationalised banks (like SBI, HDFC Bank) on behalf of oil importers. However, overall, the US dollar continued to remain weak as investors turned sceptical over US President Donald Trump's proposed tax reforms," Vijay Singhania, Director, Trade Smart Online, asserted.

In addition, Dhruv Desai, Director and Chief Operating Officer of Tradebulls, pointed out that investors' sentiments got soothed with the report that bank credit growth improved to 5.52 percent in the first fortnight of the financial year (FY18), after falling to a whopping six-decade low of 5.08 percent in the previous financial year (FY17).

"Some support also came with Finance Minister Arun Jaitley asserting that the government was giving top priority to addressing the issue of bad loans while acknowledging that the problem of non-performing assets was adversely impacting the Indian banking system," Desai elaborated.

"Benchmark FMCG index -- NIFTYFMCG -- traded with firm sentiments tracking strong buying sentiments in most FMCG stocks."

The top weekly Sensex gainers were: Mahindra and Mahindra (M&M) (up 5.95 percent at Rs 1,334.55), Gail (up 5.81 percent at Rs 423.75), Asian Paints (up 5.33 percent at Rs 1,119.60), Maruti Suzuki (up 5.19 percent at Rs 6,525.50) and Axis Bank (up 4.90 percent at Rs 509.60).

The losers were: Lupin (down 5.06 percent at Rs 1,337.80), Tata Consultancy Services (TCS) (down 1.69 percent at Rs 2,272.10), NTPC (down 1.59 percent at Rs 164.40), Cipla (down 1.17 percent at Rs 556.80), and Infosys (down 0.47 percent at Rs 919.40).

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