Mumbai: The Sensex made a smart recovery of 255 points to close at a new peak of 31,312 on Monday and the Nifty reclaimed the key 9,600 level, riding piggyback on GST headway and expectations of reforms by Sebi. The markets saw a flurry of buying as investors sensed NPA resolution gaining traction after the Reserve Bank asked lenders to initiate bankruptcy proceedings against large defaulters.
Positive global cues emerging from other Asian markets that ended higher in tune with weakened record closing at the Wall Street propped up the markets here. A firm opening at European shares in a reaction to a strong victory for President Emmanual Macron’s centrist party in French parliamentary elections, as Britain begins formal Brexit talks, buoyed trading sentiments here.
“The Market is back to the buoyed sentiment due to relaxation in return filing timeline to minimize the impact of transition to GST. On the other hand, RBI’s insistence that the banks start the bankruptcy proceedings which will improve bank’s asset quality & strengthen the balance sheet, led the index to climb by 1%,” said Vinod Nair, Head of Research, Geojit Financial Services Ltd.
After a strong opening, the BSE 30-share index hit a high of 31,362.15, before closing at a new record high of 31,311.57, up 255.17 points, or 0.82%, breaking its previous record closing of 31,309.49 on June 5. The gauge had lost 99.51 points in the previous two sessions.
The 50-share Nifty too scaled a high of 9,673.30 before ending 69.50 points up, or 0.72%, at 9,657.55. Market rundown by Mr. Vinod Nair, Head of Research, Geojit Financial Services Ltd for your perusal. Risk-on improved after the GST Council yesterday relaxed return filing rules for businesses for the first two months of the rollout of the new indirect tax regime even as it stuck to the July 1 launch date.
Buying activity gathered momentum after the Reserve Bank urged lenders to initiate bankcruptcy proceedings against large loan defaulters, brokers said Banking stocks hogged the limelight led by SBI, Axis Bank, HDFC Bank and ICICI Bank that extended gains, rising by up to 1.94%.
Other gainers that also supported the key indices were Adani Ports (3.05%), PowerGrid (1.67%), L&T (1.59%), Reliance Industries (1.53%), TCS (1.44%), Hero MotoCorp (1.39%), ITC Ltd (1.35%), Asian Paint (0.92%), HDFC Ltd (0.89%), Cipla (0.39%) and Bajaj Auto (0.39%).
Among the BSE sectors, metal jumped 1.89%, followed by banking 0.96, capital goods 0.74%, FMCG 0.72%, oil&gas 0.45%, power 0.43%, PSU 0.29% and auto 0.25%. Broader markets looked mixed as the mid-cap index rose 0.07%, while small-cap index was down 0.08%.
Shares of Dredging Corporation of India rose 2.08% to Rs 705.30 on buzz of stake sale by the government in the company. Meanwhile, Domestic Institutional Investors (DIIs) bought shares worth Rs 890.91 crore on Friday, as per provisional data.
However, the point of worry was foreign portfolio investors (FPIs) who sold stocks worth Rs 764.48 crore.
Globally, in the Asian region, key indices in Japan rose 0.62%, Hong Kong was up 1.16%, Shanghai Composite Index rose 0.68%, South Korea was up 0.38% and Taiwan ended 0.92% higher. European indices were trading higher in their late morning session.
