MUMBAI: The sensex rose 666 factors to 85,836 on Thursday, whereas Nifty superior 212 factors to shut at a report excessive of 26,216. The sixth consecutive session of positive aspects was pushed by a rally in auto and steel shares. While automakers surged on hopes that state govts would supply tax cuts and incentives for hybrid autos, steel shares benefited from greater international costs.
The sensex hit an intraday peak of 85,930, and Nifty touched a excessive of 26,251 through the day’s session. Of the 30 sensex shares, 28 ended the day in inexperienced, with Maruti, Tata Motors, Bajaj Finserv, Mahindra & Mahindra, and Tata Steel being the highest gainers. L&T and NTPC have been the 2 shares that declined.
“The market is experiencing strong liquidity flows. Foreign institutional investors have become buyers in Sept with net purchases of Rs 24,000 crore. Mutual funds and local investors are also buying, and there are no major sellers,” mentioned Nilesh Shah, MD at Kotak Mutual Fund. Despite the sturdy inflows, the rupee weakened barely to 83.64 in opposition to the greenback, down from 83.59, as a consequence of elevated demand for the greenback from importers.
Sector-wise, the auto index surged 2.2%, steel shares gained 2.1%, and others like commodities (1.3%), FMCG (0.8%), and shopper discretionary (0.8%) additionally contributed to the rally. However, industrials, telecommunications, and utilities lagged.
According to Shah, liquidity alone can’t maintain a rally that was seen in previous bull runs in 1998, 2000 and 2008. “What we are now witnessing is a Triveni Sangam of liquidity, sentiment, and fundamentals. From FY10-20, corporate profits grew at a CAGR of under 3% and between FY20-24, profits have grown nearly four times to Rs 15 lakh crore. When there is a fourfold growth in profits, markets will go up. There is also a sentiment that India’s time has come.”
