Reuters
Indian shares rose to their second consecutive record high yesterday as blue-chips such as Tata Motors gained on positive institutional inflows, while oil retailers surged after Brent crude prices hovered near 14-month lows.
The broader NSE index rose as much as 0.56% to 7,918.55, while the benchmark BSE index gained as much as 0.53% to 26,530.67, surpassing their previous all-time highs hit on August 18. Modi government’s promise of reforms and central bank governor Raghuram Rajan’s inflation target and management of the rupee crisis last August have inspired confidence among foreign investors who have pumped in $12.33bn in equities so far this year.
Expectations that falling crude oil prices will augur well for importers, and higher global stocks on renewed risk appetite, also helped.
“Foreign investors are supporting the rally. Sentiment is positive but cautious. Markets will trade range-bound for the time being,” said Suresh Parmar, head, institutional equities at KJMC Capital Markets.The BSE index rose 0.11%, or 29.71 points, to end at 26,420.67, while the NSE index rose 0.3%, or 23.25 points, to end at 7,897.50.
Also, both the indexes marked their sixth consecutive day of gains, their longest winning streak since July 24 when they rose for eight sessions.
Overseas investors bought cash shares worth of Rs4.73bn ($77.8mn) on Monday, provisional exchange data showed. They also purchased equity derivatives worth of Rs15.12 billion.
Also, domestic institutional investors bought cash shares worth of Rs4.90bn in the previous session raising hopes that retail investors’ interest might be coming back in the market.
Rupee up slightly
The rupee strengthened slightly yesterday on bunched up dollar inflows after a four-day weekend and as shares hit a second consecutive record high, but broader gains were capped by good greenback demand from oil importers.
Trading in the foreign exchange market resumed after two trading holidays on Friday and Monday, leading to bunched up dollar inflows, helping the rupee appreciate.
India’s BSE and NSE indexes, which were open for trading on Monday, hit second consecutive record highs yesterday on the back of good institutional demand, both from home and abroad.
Equity traders cited optimism after Prime Minister Narendra Modi vowed to fire up the bureaucracy to deliver results on Friday, although the impact was limited as he did not announce any sweeping market reforms.
The partially convertible rupee closed at 60.6750/6850 per dollar compared with 60.76/77 on Thursday.
The unit moved in a tight band of 60.6550 to 60.7825 during the session.
Traders broadly expect the unit to remain in a 60.20 to 61.20 range during this week.
