At close of trading on Friday, the index was just 130 points short of the 10,000-mark, having gained 185 points during the day.
MUMBAI: The Bombay Stock Exchange Sensex is well set to keep its date with destiny - perhaps as early as next week. At close of trading on Friday, the index was just 130 points short of the 10,000-mark, having gained 185 points during the day.
Friday was a day of contrasts: While as many as 13 market indices, including the Sensex and Nifty, hit their all-time peaks, the market’s breadth was negative on the BSE, with losing shares outnumbering gainers 13:10. The breadth was, however, positive on the National Stock Exchange, gainers having the edge 6:5.
Investor wealth soared and crossed the Rs 26,00,000 crore mark. Analysts attribute the quick climb of the Sensex to steady inflow of overseas money. “Money flow from overseas institutions continues to be strong. The number of new fund offers lined up by mutual funds also contributes to the positive sentiment,” said Amish Choksi, vice-president, institutional equities, at Edelweiss Capital.
A new source of inflows is oil money. According to market insiders, money is pouring in from many oil-exporting countries, including Venezuela. “Though they continue to put two-thirds of their money in dollar-denominated assets, the remaining is parked in assets denominated in yen and rupee, among others,” said Anil Sarin, co-head of equity at Prudential ICICI Mutual Fund.
On Thursday, foreign institutional investors (FIIs) were net buyers to the tune of Rs 820 crore, taking their cumulative investments this month to Rs 2,631.7 crore. Mutual funds, however, have been net sellers this month by Rs 1,600 crore.
Analysts said that fund redemptions have been strong as people seem to be taking money out of existing schemes and parking them new fund offers (NFOs) in the mistaken belief that they are getting units cheaper. But the fresh inflows into NFOs will sooner or later get into stocks, buoying sentiment.
The Sensex has gained 473 points (5%) in 2006 so far, closing at 9,870.79 on Friday, while the Nifty has gained 146 points (5.2%) over the same period. It closed at 2,982.75 points on Friday.
The past three trading days brought in a big chunk of the Sensex and Nifty gains - 406 points (4.29%) and 98.70 points (3.43%) respectively.
Besides the Sensex and Nifty, the BSE 500, BSE 200, BSE 100, BSE Mid-cap, BSE PSU, CNX Nifty Mid-cap, CNX Nifty Junior, BSE Auto, Capital Goods, FMCG and Healthcare indices hit their all-time highs.
Steel stocks were the pick of the day as Mittal Steel, the world’s largest producer, announcing a bid to acquire Arcelor, the world’s No 2. Tata Steel, Jindal Stainless, Jindal Steel, Essar Steel and Steel Authority of India gained in excess of 6% on the BSE, on excitement over the expected consolidation which could firm up world prices.
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