Sensex up 363 pts on timely monsoon and rate cut hopes
Prediction of timely arrival of monsoon amid hopes of key rates cut by the apex bank in first of June in its second bio-monthly monetary policy review boosted the sentiment for the second session in a row as the benchmark S&P BSE Sensex rallied by 363 points to end at <g data-gr-id="27">more-than</g> 3-week high of 27,687.30.
<g data-gr-id="24">Smart</g> rise in oil and refinery stocks on the back of hike in petrol and diesel prices last week amid containing the fiscal deficit and slow-down in foreign funds outflow too buoyed the market sentiment.
Fiscal deficit contained at 4.0 per cent of GDP for 2014/15, lower than <g data-gr-id="23">downwardly</g> revised estimate of 4.1 pct provided by Modi government’s first full budget announced in February. The BSE 30-share barometer resumed with an <g data-gr-id="21">upwide</g> gap at 27,416.97 from previous close of 27,234.00 and gradually moved upwards to settle at 27,687.30 --level not seen since April 23, 2015 when it had finished at 27,735.02--, exhibiting a rise of 363.30 points or 1.33 pct.
Last Friday, it has firmed up by 117.94 points or 0.43 pct. Similarly, the wide-based 50-issue CNX Nifty of the NSE also resumed higher at 8,284.95 from last close of 8,262.35 and rallied further to cross 8,300-mark to intra-trade high of 8,384.60 before settling at <g data-gr-id="18">more-than</g> three-week high of 8,373.65, showing a net gain of 111.30 points or 1.35 pct.
Besides refinery, pharma, FMCG, capital goods, power, banking, IT and <g data-gr-id="14">teck</g> shares also were in keen demand and notched handsome gains. Among Asian markets, Japan, South Korea and Taiwan ended with gains while China, Hong Kong and Singapore finished with losses.
Investment via P-Notes drops to $42 billion
Investments into Indian markets through participatory notes (P-Notes) have dropped to Rs 2.68 lakh crore ($42 billion) at the end of April, after hitting over 7-year high in the preceding month. P-Notes, mostly used by overseas HNIs (High Net Worth Individuals), hedge <g data-gr-id="55">funds</g> and other foreign institutions, allow such investors to invest in Indian markets through registered Foreign Institutional Investors (FIIs). This saves time and costs for them, but the flip side is the route can also be used for <g data-gr-id="50">round tripping</g> of black money. According to data released by Securities and Exchange Board of India (Sebi), <g data-gr-id="51">total</g> value of P-Notes investment in Indian markets (equity, <g data-gr-id="52">debt</g> and derivatives) declined to Rs 2,68,168 crore.