Markets create new records on earnings surge, liquidity

Markets made fresh records their new

home as the Sensex today settled at 32,515 and the Nifty

10,077, riding on tailwinds of strong corporate earnings amid

expectations of an interest rate cut by the Reserve Bank.

The rally mirrored strength in most Asian indices.

European shares ruled high too despite heightened tension over

North Korea's missile programme.

The 30-share Sensex settled at the new high of 32,514.94,

up 205.06 points, or 0.63 per cent. This has breached the

previous closing record of 32,383.30 hit on July 27.

The gauge had lost 73.42 points in the previous session

on Friday.

The 50-issue NSE Nifty hit an all-time high during the

day. It settled up 62.60 points, or 0.63 per cent, at a fresh

life high of 10,077.10, breaking its previous record of

10,020.65 recorded on July 26.

"Good results from index heavyweights continue to add

liquidity while the country's largest PSU bank's interest rate

cut decision attracted investors to the banking stocks on

expectation of more peers to follow the trend. Moderation in

inflation to below RBI's target of 4 per cent heightened the

expectation of rate cut during the next monetary policy," said

Vinod Nair, Head of Research, Geojit Financial Services.

The largest lender, State Bank of India, was on the top of

the pack, up 4.46 per cent, after it slashed interest rate on

savings account deposits by 50 bps to 3.5 per cent on balance

of up to Rs 1 crore.

Expectations are building that the RBI would take note of

the softening inflationary trend and ease policy at its

upcoming meet on Wednesday. Inflation has since dropped to

record low.

Investors also continued to keep faith in the quarterly

corporate earnings story and this optimism rubbed off on the

indices.

Shares of Larsen and Toubro surged by 2.85 per cent after

the company posted a 46 per cent cent jump in consolidated net

profit for the June quarter.

The BSE consumer durable goods starred in the rally by

surging 1.86 per cent, followed by metal and PSU.

A similar story played out in broader markets.

Traders said risk sentiment improved by strong liquidity

amid pumping of sufficient funds by foreign as well as

domestic institutional investors and widespread buying by

retail investors after more blue-chip companies came out with

better-than-expected first quarter earnings figures.

DIIs bought shares worth a net Rs 424.67 crore while FPIs

net sold shares worth Rs 223.12 crore on Friday, as per

provisional data.

(This article has not been edited by DNA's editorial team and is auto-generated from an agency feed.)