Sensex, Nifty touch record highs; bank stocks roll

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SME Times News Bureau | 28 Nov, 2014
Positive international and domestic cues led a bullish up drive in a benchmark index of Indian equities markets which Friday hit a record high of 28,822.37 points, surpassing its previous high of 28,541.22 it touched Nov 25.

Bullish sentiments were witnessed as a result of positive global cues like OPEC’s (Organisation of the Petroleum Exporting Countries) decision to sustain the production levels which lead to a sharp fall in crude prices.

Following the announcement, Brent crude hit its lowest price since August 2010, falling to below $72 a barrel.

The 12-member OPEC decided to maintain production at 30 million barrels per day as first agreed in December 2011.

On domestic front, expectations of a dovish move by the Reserve Bank of India (RBI) to cut key lending rates after a slew of data showed easing inflation impacted interest sensitive stocks like banking positively.

India's consumer price index-based inflation eased to a record low of 5.52 percent during October - from 10.17 percent during the corresponding month last year - on the back of lower food prices and fuel costs.

The retail inflation rate recorded is the lowest since India started computing consumer price index (CPI) in January 2012.

Industrial activity, measured in terms of the Index of Industrial Production (IIP), grew by 2.5 percent during September over the corresponding month of the previous year.

Both the data have led the India Inc. to demand a rate cut from the RBI when it holds the fifth bi-monthly monetary policy review on Tuesday, Dec 2, 2014.

"Markets are hoping for a rate cut in the RBI policy meeting next week. Going ahead, apart from the RBI meeting, fiscal reforms from the government will be needed for the markets to move higher on a sustainable basis,” said Dipen Shah, head of private client group research, Kotak Securities.

On Friday, all the sectors except information technology (IT) made gains. Healthy buying was observed in bank, automobile, capital goods, consumer durables and metal stocks while selling pressure was seen in IT and technology, entertainment and media (TECK) sectors.

The 30-scrip Sensitive Index (Sensex) of the S&P Bombay Stock Exchange (BSE), which opened at 28,490.71 points, ended the day's trade at 28,693.99 points, up 255.08 points or 0.90 percent from the previous day's close at 28,438.91 points.

The Sensex touched a high of 28,822.37 points and a low of 28,483.99 points in the intra-trade.

The S&P bankex surged by 591.38 points, auto index went up by 367.76 points, capital goods index gained by 164.43 points, consumer durables index rose 110.93 points and metal index increased by 52.43 points.

The S&P BSE IT index was down 11.14 points and TECK index was lower by 6.09 points.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) too made healthy gains and touched a record high of 8,617 points surpassing its earlier milestone of 8,588.25 points hit on Nov 25.

However, it closed 8,588.25 points, up 94.05 points or 1.11 percent.

The major Sensex gainers were: State Bank of India, up 5.10 percent at Rs.321.45; Axis Bank, up 2.79 percent at Rs.481.05; Tata Steel, up 2.78 percent at Rs.473.30; Tata Motors, up 2.78 percent at Rs.532.95; and Mahindra and Mahindra, up 2.53 percent at Rs.1,323.75.

The major Sensex losers were: Sesa Sterlite, down 2.88 percent at Rs.231.30; Bharti Airtel, down 1.01 percent at Rs.381.95; ONGC, down 0.71 percent at Rs.379.50; Dr Reddy's Lab, down 0.44 percent at Rs.3,592.15; and GAIL, down 0.35 percent at Rs.487.95.

Among other Asian markets, Japan's Nikkei index was up 1.23 percent, Shanghai's Composite Index was higher by 1.99 percent and Hong Kong's Hang Seng lost 0.07 percent.

In Europe, London's FTSE 100 was lower by 0.67 percent. France's CAC 40 was down by 0.39 percent, and Germany's DAX Index fell 0.47 percent.