Backed by economic growth forecast and political stability, Indian stocks boom


Stock brokers in a jubilant mood at a brokerage as Sensex and Nifty hit all-time highs (ANI)

Notable gainers included HDFC Life, Adani Ports, Tata Motors, Hero MotoCorp, and Bajaj Auto, while Maruti, SABI Life, Kotak Bank, Infosys, and Hindustan Unilever led the losses

Our Bureau
New Delhi/Mumbai  

Indian stock market indices closed the financial year 2023-24 on a firm note, with Sensex and Nifty rising in the range of 0.8-0.9 per cent on Thursday, backed by firm economic growth forecasts by various global watchdogs and political stability at the federal level.

Sensex settled 0.88 per cent or 639 points higher at 73,635 points, and Nifty 0.92 per cent or 203 points at 22,326 points. Among the widely-tracked Nifty 50 stocks, 45 advanced and the rest 5 declined today, NSE data showed.

On Friday, the market will remain shut for Good Friday. On Monday too, the stock exchanges were closed on account of Holi. The equity market extended gains and almost retested the record high. Over the past 12-month, the indices accumulated about 27-31 per cent return on investment for the investors.

“Indian equities closed the day and fiscal year on an optimistic note, with volatility by the end of the session, as buying by retails, DIIs, and FIIs surged across categories,” said Vinod Nair, Head of Research, Geojit Financial Services.

“The mid- and small-cap stocks have emerged as frontrunners, rebounding from the initial sell-off earlier in the month. An upgrade in the domestic economy forecast hints at an encouraging outlook for the stock market in FY25. However, the emphasis is on large-cap due to the persisting premium valuations of mid-cap stocks, which could pose a concern on the broad market in the short to medium term.”

Emkay Institutional Equities, a part of Emkay Global Financial Services Limited, maintains its stance of Nifty to remain at 24,000 level. Emkay expects the market to rebound in 3-6 months, when SMIDs (Small and Mid Caps) would start to outperform again.

For the time being, Ajit Mishra, SVP – Technical Research, Religare Broking suggests continuing focus on stock selection, with a preference for the index majors and large midcaps. Back home, foreign portfolio investors continue to remain net buyers in India. This also buoyed the stocks.

Foreign portfolio investors who had aggressively sold Indian stocks and turned net sellers in the Indian equity market in January 2024 became net buyers in February and March. This has also likely buoyed the stocks of late.

In March, they bought stocks in India worth Rs 31,056 crore, the latest data from the National Securities Depository Limited (NSDL) showed.

Separately, the Beta version of optional T+0 settlement, for a limited set of 25 shares, started today. The T+0 system means that the settlements must be done within the same day, of the completion of a transaction.

The Board of the SEBI will review the progress at the end of three months and six months from the date of this implementation, and decide on further course of action. Currently, India follows the T+1 cycle, which means trades are settled by the next day.

Earlier, the stock market kicked off the trading day on a subdued note, opening marginally in the red following the Holi festivities. As the trading bell rang on Tuesday morning, stock indices reflected a flat sentiment, with the benchmark Sensex down by 234.50 points, opening at 72,597.44, while the Nifty slipped 47.95 points to commence at 22,048.80.

Among the Nifty companies, 13 advanced while 37 declined in early trade.

Notable gainers included HDFC Life, Adani Ports, Tata Motors, Hero MotoCorp, and Bajaj Auto, while Maruti, SABI Life, Kotak Bank, Infosys, and Hindustan Unilever led the losses.

The truncated trading week, coupled with looming factors such as the March F&O expiry and fiscal year-end, is expected to keep trading volumes subdued while volatility may persist.

Varun Aggarwal, founder and managing director, Profit Idea, said, “Resistance levels for the market are noted around 22,200-22,300, with a breakthrough potentially triggering significant upward movement.”

He added, “Additionally, on the weekly chart, the Nifty formed a small positive candle, with support around the 10-week Exponential Moving Average (EMA) indicating a favourable short-term trend outlook, with potential for the Nifty to reach new all-time highs around 22,550 levels.”

Options data reflects some improvement, with the put-to-call ratio rising to 1.23 from oversold levels. However, foreign institutional investors (FIIs) maintain a high level of short exposure in index futures, currently at 65 per cent, suggesting potential for a short-covering rally.

In global markets, Asian equities showed mixed performance following a pullback in US stocks. Investors remain cautious amid concerns about a disconnect between earnings expectations and share prices, with sentiment perceived as stretched and a US equity market pullback deemed overdue.

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