Big sugar rush on Street, party to continue

Dalal Street finally got the sugar fix it desperately craved, as a one-two of reforms by the government and opening of the dollar tap by the US Federal Reserve lifted asset classes across the globe on Friday.

The Bombay Stock Exchange bellwether, the Sensex, closed at 18464.27, up 443.11 points or 2.46%, its highest close since July 26, 2011, with 26 of the 30 stocks making up the index ending gaining. The National Stock Exchange’s Nifty wound up at 5577.65.

Such was the animal spirits, investors made as much as Rs95,437 crore of notional wealth in a matter of one session on Friday, as BSE’s market capitalisation surged to Rs63.63 lakh crore.

The Indian markets have risen for eight straight sessions now, adding nearly Rs 300,000 crore to investor wealth.

The US Federal Reserve announced plans of injecting at least Rs200,000 crore every month into the country’s financial system, triggering a global rally in equities and other risky assets on improved investor sentiment. The Standard & Poor 500 index in that country rose to the highest level in around five years.

In India, realty and metal indices were the best performing ones, up 4.78% and 4.25% respectively. Banking was up 4.15%.
The markets even shrugged off inflation data which came in at 7.55%, roughly 0.5% more than expectations.

Interestingly, stocks related to foreign direct investment were also up in anticipation of government moves on reforms, said Sanjeev Zarbade, vice-president (private client group research), Kotak Securities.