A bronze replica of a bull is seen at the gates of the Bombay Stock Exchange (BSE) building in Mumbai February 26, 2010. Indian shares climbed 1.1 percent on Friday to their highest close in more than two weeks, after the national budget raised tax exemption limit for individuals and boosted consumption power. REUTERS/Arko Datta (INDIA - Tags: BUSINESS ANIMALS) - RTR2AY0Y
Bulls retained tight control over Dalal Street for the third consecutive session on Wednesday as the Sensex closed above psychological 30,000-mark for the first time ever. While the Nifty settled at record closing high ahead of expiry of April derivatives contract (due Thursday), the broader markets lost ground on profit booking.
The rally was driven by hopes of earnings growth and continued buying by domestic investors. Rising global optimism on French elections results and likely announcement of tax reforms by Donald Trump in the US also pushed the markets higher.
The 30-share BSE Sensex closed up 190.11 points at 30,133.35 and the 50-share NSE Nifty gained 45.25 points at 9,351.85 despite volatility in late trade, driven by banking & financials and FMCG stocks.
With having a cautious view on markets after record closing high, experts said the market is highly valued at current levels. They expect some consolidation in near term, though they are bullish on market for next couple of years.
"Volatility will remain high due to the derivatives expiry tomorrow," Jayant Manglik (President, Retail Distribution) of Religare Securities said, while reiterating positive view on markets. He suggests using dips to add quality stocks.
It believes any intermediate dips from hereon should be used as incremental buying opportunity.
Jeff Chowdhry, a senior portfolio manager at LGM Investments said, "We remain incremental buyers in Indian markets." Higher valuation for Indian market does not particularly trouble him.
“We are always happy when markets go to all-time highs and particularly happy because India is our biggest allocation in the emerging market funds (EMs). We have almost 30 percent of the global emerging market fund in India,” he said.
While FIIs have been net sellers so far in April after more than Rs 33,000 crore worth of buying in March, domestic investors bought more than Rs 6,000 crore worth of shares in current month.
The Nifty surged more than 14 percent and the Sensex gained over 13 percent so far in the current year while the BSE Midcap shot up nearly 23 percent.
The broader markets underperformed benchmarks today, with the BSE midcap index falling 0.12 percent and Smallcap down 0.6 percent on profit booking. About two shares advanced for every share rising on the bourses. Total market turnover was Rs 8.29 lakh crore.
On the global front, Asian markets closed higher following a positive lead from Wall Street on the back of strong earnings announcements and on hopes of tax reforms in the US. Japan's Nikkei gained 1 percent. European indexes were moderately lower on profit booking, at the time of writing this article.
Meanwhile, the rupee gained past 64 against the US dollar intraday today, hitting 20-month high but trimmed gains in second half of session. It closed at 64.11 a dollar, up from 64.26 in previous session.
Nifty Bank also ended at fresh closing high of 22,242.85, up 0.85 percent on hopes of early improvement in asset quality. Axis Bank gained 0.4 percent ahead of earnings later today while ICICI Bank rose 1.6 percent and HDFC Bank was up 0.73 percent.
ITC and HDFC were leading contributors to Sensex' gains, up 3.36 percent and 2.36 percent, respectively. Both ended at record closing highs.
Auto stocks gained momentum ahead of monthly sales numbers due next week and Maruti (up 0.88 percent) earnings due Thursday. Mahindra & Mahindra rallied 3 percent for second consecutive session, followed by Tata Motors (up 1 percent).
Among others, HUL and Bharti Airtel climbed over 1 percent whereas technology stocks were under pressure on rupee appreciation. Infosys was down 1.6 percent while Wipro lost 0.8 percent after rising 3 percent intraday as investors remained cautious about company's FY18 earnings.
Reliance Industries, BHEL, Adani Ports and Dr Reddy's Labs fell 1-2 percent on profit booking.
In the broader space, Allcargo Logistics gained 6 percent after PE investor Blackstone exited the company by offloading 3.8 crore shares (14 percent equity) through block deal.