D-Street unfazed with early morning crack in China shares; Nifty hits fresh highs

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Indian market opened with a gap on the higher side on Monday which took the index to hit its fresh record high of 9,920.30. But, there was a bigger crack in China led by fall in smallcap stocks but better economic data helped pare losses.

Chinese equity markets plunged shortly after trading began on Monday, led by fall in in small-cap stocks after a high-profile financial conference signaled that policy makers are focused on tighter control of the economy, said a report.

The Shanghai Composite fell as much as 2.6 percent and the Shenzhen Composite slumped 4.5 percent at one point; they were last down 0.6 percent and 3 percent respectively.

However, China’s second quarter GDP growth fuelled market sentiment and helped pare losses. China's economy grew faster than expected in the second quarter as industrial output and consumption picked up, said a Reuters report.

The economy grew 6.9 percent in the second quarter from a year earlier, the same rate as the first quarter, the National Bureau of Statistics said on Monday, it said. Analysts polled by Reuters had expected the economy to expand 6.8 percent in the April-June quarter.

On a quarterly basis, growth picked up to 1.7 percent from 1.3 percent in the first quarter, in line with expectations.

Back home, Indian market got off to a healthy start after a muted close in the previous trading session on Friday. Most analysts’ tracking D-Street remain cautious on markets especially after 20 percent rally so far in the year 2017.

The Nifty has yet again entered into an overbought zone and being cautious would not harm, suggest experts. Having said that, the overall trend continues to remain solid and analysts expect the current move to continue towards the projected breakout target of 9970 in the coming week.