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Day after US exits QE, Japan plays it ‘easy’

Day after US exits QE, Japan plays it ‘easy’
Indian markets on Friday ended the week with a bang with Sensex zooming 519.50 points and Nifty soaring 153 points to new highs for the second straight day in line with a strong global rally after Japan unexpectedly increased its monetary stimulus and US grew at a robust pace.

Hopes of more reform measures from Modi government, expectations of better growth in the second half of the fiscal and heavy buying by foreign funds, also had a positive impact.

Investor wealth soared nearly Rs 1.5 lakh crore in a single session on Friday as six stocks out of every ten traded ended in the green. Barring consumer durables, all 11 other sectoral indices finished with gains between 0.45 per cent and 2.66 per cent. Capital goods, oil & gas, IT, power, banking, pharma, auto and realty segments lead the winners.

Overall, 29 out of 30 Sensex-based scrips finished higher while only Bharti ended in the red. HDFC, Infosys, L&T, RIL, HDFC Bank, TCS, SBI Tata Motors, ONGC and ICICI Bank among others kept the market tempo upbeat.

The benchmark S&P BSE Sensex resumed strong and continued to move upwards to settle at its new historic high of 27,865.83, showing a rise of 519.50 or 1.90 per cent. During the week, it shot up by 1,014.78 points or 3.78 per cent and 1,866.49 points or 7.18 per cent in last nine out of ten days. The 50-issue CNX Nifty of NSE also flared up by 153 points, or 1.87 per cent, to end at new peak of 8,322.20.

The Sensex and Nifty also logged new intra-day highs of 27,894.32 and 8,330.75 today. This was after they hit previous highs of 27,390.60 and 27,390.60 on Thursday.

‘Much-needed reforms from the new government, strong Q2 performance by India Inc, Fed's low-interest rate regime combined with Bank of Japan's sudden stimulus announcement, gave markets across a sentiment boost,’ said Hiren Dhakan, Associate Fund Manager, Bonanza Portfolio.

Sentiment was also boosted after the US released forecast-beating economic growth data on Thursday. The world's biggest economy grew 3.5 per cent in the September quarter. In overseas markets, Asian stocks rose between 0.28 per cent and 4.83 per cent. The Japanese central bank expanded the size of its government bond purchases to the equivalent of about 80 trillion yen a year, an increase of 30 trillion yen.

European stocks were also trading higher in their early trade as key indices in France, Germany and UK rose by 1.07 per cent to 1.84 per cent.

‘Stupendous beginning to the Indian markets for the November series this time the surprise is from Bank Of Japan which has decided to continue its asset buying programme to boost the economy.
Indian Markets have closed above resistance levels,’ said Rajshekar Gowda, Senior Analyst, HBJ Capital. Investor sentiment also got a boost after provisional data showed foreign portfolio investors bought shares worth a net Rs 1,257.49 crore on Thursday.

Jignesh Chaudhary, Head of Research, Veracity Broking Services said, ‘The US economic recovery also boosted the confidence of the investors.’

Major gainers from the Sensex pack included HDFC (4.13 per cent), Gail India (3.83 per cent), L&T (3.61 per cent), Tata Power (3.36 per cent) and  Tata Steel (3.15 per cent).
PTI

PTI

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