Stocks retained their winning knack for the fourth straight day as the Sensex today gained 127 points to end at a fresh 11-month high of 27,942 amid unabated foreign inflows on hopes of better corporate earnings numbers. Expectations of more stimulus action from Japan to fast-track growth and another record close in the US laid the pitch for the rally. But concerns lingered after WPI inflation accelerated for
the third straight month in June hitting 1.62% on costlier food and manufactured items, official data showed on Thursday.
June retail inflation, announced on Tuesday, was no better, which touched a 22-month high of 5.77%. While TCS came out with its results on Thursday after market hours, that of Infosys is due on Friday. There was good news on the monsoon front, which cheered investors.
According to IMD, the country has so far received 4% more rainfall than normal. The monsoon has also covered the entire country two days ahead of its normal date after reaching last frontiers of Kutch and Western Rajasthan. The covering-up of short positions aided the upmove. But the suspense over a new RBI Governor continued to hold back investors.
The Sensex opened higher before settling at 27,942.11, a gain of 126.93 points, or 0.46%. The barometer ended at 28,067.31 on August 14 last year. It had gained 688.28 points in the previous three sessions. The 50-share NSE Nifty settled 45.50 points, or 0.53% higher at 8,565. Globally, Asian markets followed overnight gains in the US, which saw a record close on the Wall Street and a higher opening in Europe. London's FTSE gained 0.8%, Germany's DAX 1.3% and Paris CAC 0.9% in their early session.
As many as 22 scrips out of 30-share Sensex pack ended higher. ICICI Bank was right on top rising 2.72% followed by Maruti Suzuki. Shares of TCS ended 1.16% higher ahead of earnings announcement. Other big movers include SBI (2%), Power Grid (1.82%), GAIL (1.45%) and Tata Motors (1.20%).
Consumer durable sector was in the thick of action as the index rose 2.16%, followed by banking 1.48%, PSU 1.12% and capital goods 1.01%. Small-cap and mid-cap too firmed up 0.73% and 0.54%, respectively, on increased buying by retail investors.
Jewellery stocks hogged limelight after the government increased excise duty exemption limit for small scale industry to Rs 10 crore that could bring relief to gold jewellers. On Wednesday, it also decided to waive the levy on sale of traded goods and relaxed other procedural norms. Shares of Tara Jewellers soared, Shree Ganesh Jewellery House, Gitanjali Gems, Tribovandas Bhimji Zaveri, PC Jeweller and Titan Company surged by up to 6.45%.
Foreign portfolio investors (FPIs) remained net buyers, purchasing shares worth Rs 290.53 crore on Wednesday, as per provisional data. Overseas, the US dollar mostly traded lower against its major rivals in early Asian trade, while the yen surrendered its early gains and sterling pushed higher but remained capped ahead of a Bank of England meeting that is expected to deliver an easing to blunt the economic fallout of Britain's vote to leave the European Union.
The pound rose firmly against other major currencies on Thursday, as investors waited for the Bank of England's first post-Brexit policy decision to see if the central bank will cut rates for the first time in seven years. Analysts said the UK currency had gotten a boost overnight from new Prime Minister Theresa May's reshuffle of cabinet, particularly in appointing Philip Hammond as the new finance minister.
Meanwhile, oil prices rebounded in Asia on Thursday thanks to a weak dollar and bargain-hunting a day after the commodity sank to fresh two-month lows. US benchmark West Texas Intermediate was up 61 cents, or 1.36%, at US $45.36 while Brent crude rose 57 cents, or 1.23%, to US $46.83.
The benchmark Sensex continued to rule firm for the fourth consecutive day, surging 127 points to close at fresh 11-month high at 27,942.11 on persistent buying mainly in consumer durable and banking counters despite rise in inflation figure amidst higher European cues.
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