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Mumbai: Rain dance on Dalal Street as Sensex hits new high

Thursday, 3 July 2014 - 6:30am IST | Place: Mumbai | Agency: dna

Index closes at 25841.21 as reports suggest El Nino skipping India; participants eye 8000 on Nifty by budget announcement next week

Monsoon across major parts of the country on Wednesday brought cheer to the equities market that opened with a major jump in the morning trade.

Sensex hit an all-time high of 25864.53 intra-day, and closed at 25841.21, surpassing the previous high of 25735.87 on June 11.

Market participants said the Sensex on Wednesday opening with a rise of 144.22 points from its previous close of 25516.35, and 48.35 points on the Nifty (previous close 7,634.70) was largely on account of a meteorological report that said the weather phenomenon El Nino was unlikely to hit India.

"The report and the rains across major parts of the country gave the much-needed boost ahead of the budget. It brought the much-awaited relief on rising food prices and inflation worries," said a fund manager at a brokerage.

The BSE Sensex ended higher by 324.86 points, or 1.18%, at 25841.21, while Nifty closed 90.45 points up or 1.18% at 7725.15 points. Of the 50 stocks on the Nifty, six declined while the rest rose. Major losers were HCL Technologies which lost 1.16% at Rs 1,480.15 and Infosys which dipped 0.5% at Rs 3,2404.85.

Gainers were Sesa Sterlite at Rs 309 (4.4% up), NTPC Rs 159.60 (3.23%), Bhel Rs 259.70 (2.87%) and Lupin Rs 1078 (2.71%).

Foreign institutional investors (FIIs) were net buyers of equities to the tune of Rs 1,290.68 crore while domestic institutional investors were net sellers at Rs 407.71 crore.

Most market players now expect Nifty to breach the next psychological level of 8000. "I do expect Nifty to touch 8000, but most likely it could be on the day of the budget announcement (on July 10)," said Rahul Shah, vice-president at Motilal Oswal Financial Securities.

The markets have five trading sessions before the budget, and there could be a possibility of the level being breached before the budget, a few market players said.

"Historically, such levels coincide with the event or after the event," said Arun Kejriwal of Kejriwal Research.

"But the bull run is there to stay though with intermittent corrections," he said.

Most market participants now expect a temporary pause in the rally. "The markets are likely to take a breather before the bull run resumes," said Shah.

For the April-June quarter, the Sensex gained by 3027.51, or 13.5%, since March 31, while Nifty appreciated 907 points, or 13.5%. Market capitalisation, or investor wealth, grew Rs 16 lakh crore to Rs 90.20 lakh crore during the period.

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