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Markets back to winning ways

Sensex, Nifty close at fresh record highs as FIIs continue to pump money into equities

The markets closed at record highs on Wednesday on sustained buying by overseas investors and positive global sentiment. On Wednesday, foreign institutional investors (FIIs) bought equities worth $173 million, taking their year-to-date tally to $4.7 billion. FIIs have been net buyers in each of the last 20 sessions, investing a total of $4.1 billion.

According to experts, investors are hoping that the high voter turnouts being seen in the ongoing elections would lead to a stable government. ?Voters are turning out in high numbers to cast their votes. However, we expect markets to remain volatile, going ahead,? said Rikesh Parikh, vice-president, market strategy, Motilal Oswal Financial Services.

On Wednesday, the BSE benchmark Sensex closed 358.89 points, or 1.61%, higher at 22,702.34, while NSE Nifty closed 1.51%, or 101.15 points, higher at 6,796.20. The 30-share Sensex touched an intraday high of 22,740.04, while the Nifty breached the 6,800-mark for the first time in its history. Market observers believe that the economy is already showing signs of improvement. ?We believe that there are already trends of improvement in economic growth and corporate profitability; currency and inflation has been kept under control, fiscal deficit has also improved. We believe that a likely BJP-led NDA government could provide a fillip to the economic growth and corporate profit trajectory, which could aid further re-rating of the markets,? Motilal Oswal Financial Services said in a research note.

Among sectoral indices, BSE Bankex (3.45%), BSE Metal (2.26%) and BSE Healthcare (2.21%) were the major gainers. Among individual stocks, Sun Pharma (6.91%), Axis Bank (4.44%) and Tata Motors (4.40%) were the major gainers on the 30-share Sensex.

Shares of Sun Pharma and Ranbaxy ended 6.91% and 4.90% higher, respectively, with brokerages upgrading the stocks. The Sun Pharma scrip ended at a one-month high on the BSE at R627.80 with Nomura, UBS, Axis Capital and Edelweiss upgrading the stock.

The Ranbaxy scrip ended at a three-month high at R467 with UBS, Motilal Oswal Financial Services and Barclays upgrading the stock. Brokerages have turned bullish after Sun Pharma announced its plans to buy Ranbaxy in a $3.2-billion all-stock transaction.

The BSE Bankex ended at a near one-year high. Bank of Baroda (5.41%), Federal Bank (4.89%), Axis Bank (4.44%), Yes Bank (4.19%) and ICICI Bank (4.18%) were the major gainers.

Markets sentiment has turned positive in the run-up to the national elections with the experts and opinion polls indicating a BJP-led government at the Centre.

?These opinion polls indicate a swing in votes for BJP at 13-19% versus 2009 actuals. This ?swing? has not been seen for either of the two major parties historically. Given the fragmented polity (multi-polar contest) and a first-past-the-post system, big swings in vote share are supportive of big changes in the parliamentary seats won. The trend in opinion polls over last few months has also been positive for BJP, increasing from 155-165 seats in July 2013 to 200-220 as per latest ones,? said a report released by UBS.

Among Asian markets, Hang Seng (1.09%) and Kospi (0.30%) were the major gainers on Wednesday. Most Asian indices ended in the green. Key European indices ? FTSE (0.70%), DAX (0.20%), and CAC (0.43%) ? were all trading in the green.

BSE faces trading glitch again

The Bombay Stock Exchange on Wednesday witnessed a brief trading disruption, the second time this week, after it introduced a new trading platform.

The leading exchange introduced Bolt Plus, one of the fastest trading platform, on Monday. The new system has a response time of about 200 micro seconds.

Sources said there was a technical glitch on the exchange for a brief period in the morning, but it was rectified later. On Monday too, the bourse had witnessed a glitch on the trading platform.

A BSE spokesperson did not provide any clarification on the disruption. BSE sources on Monday had said there was a minor glitch for four minutes, when the system migrated to new platform on that day. PTI

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First published on: 10-04-2014 at 03:58 IST
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