Foreign institutional investors bought shares worth Rs 773 crore on Tuesday, totalling investment of Rs 6,501 crore in last five trading sessions
As equity markets continued to remain optimistic post the budget announcement, sustained buying in several blue chip stocks, including Reliance Industries, helped the benchmark S&P CNX Nifty breach the crucial 9,000 mark for the first time in intra-day trade before ending the session a shade below from its all-time high level amid persistent buying from the overseas investors.
Extending the rally for the fourth straight session, the 50-share Nifty touched an all time high of 9,008.4 before settling the session with gains of 39.50 points at 8,996.25. The 30-share Sensex also remained in positive territory, ending 134.59 points at 29,593.73.
Experts believe that the positive announcements in the budget has started reflecting in to the investors' sentiment. Leading the upsurge, RIL shares jumped 4.1% to end at Rs 900.15. Foreign brokerage firm CLSA has said that Reliance Industries, which has highest weightage on the bourses, could report a record profit in the March quarter, thereby boosting the overall sentiment. A media report also said that LIC has increased its stake in RIL by 2.1%.
Other shares such as TCS gained 3.6%, Cipla rose 2.2% and HDFC was up 2.1%.
The advance decline ration stood at 29:21 with a positive bias. As per provisional data, FIIs infused another Rs 773 crore in the cash market clocking Rs 6,501 crore in the last five trading sessions. On the other hand, direct institutional investors (DIIs) sold shares worth Rs 303.88 crore on Tuesday.
The Union budget 2015 presented on Saturday had significant positive announcements for the markets, one being deferment of General anti avoidance rule (GAAR) and the scrapping of Minimum alternate tax (MAT) for foreign investors, say analysts.
Ambareesh Baliga, independent market expert, said, budget had positive announcements from the investment angle which will lead to more money coming into the system."
The FM also did away with the distinction between foreign institutional investors and foreign direct investment thus increasing the scope of more investment into India. The finance minister also announced reforms for the infrastructure sector. The budget proposed a seed capital of Rs 20,000 crore for National investment fund while an amount of Rs 75,000 crore was recommended to give a boost to investment in the infra sector.
Prashant Prabhkaran, president, retail broking, IndiaInfoline said, "The FM has made sure that the foreign money doesn't leave the shores of India. The containment of the fiscal deficit and current account deficit has also improved the sentiments of the investors which will help the markets to remain robust."
India VIX, the index measuring the volatility, stood at 15.4925, coming down significantly from the levels of 21 before the budget. It can be noted that the VIX and the stock index have an inverse relation.
Chandan Taparia, technical and derivatives analyst, Anand Rathi, said, "Fresh put writing is seen at strike price of 8600-9000, which signifies that the risk of going long has reduced. Also, the call writing is unwinding at 9000 levels indicating that there can be an upmove from these levels."
The immediate resistance for Nifty is at 9100-9150 levels while the support level remains at 8880, adds Taparia.
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