Sensex, Nifty snap 3-wk losing streak on progress of monsoon
Mumbai: Stocks- Both indices snapped their 3-week losing streak on renewed buying from operators and investors on hopes of above-average monsoon rain.
The BSE Sensex regained the psychological 27,000 mark and the 50-unit CNX Nifty reclaimed the crucial 8,000 mark.
The 30-share Sensex gained 890.87 points or 3.37 per cent to settle at 27,316.17, its highest closing level since June 1, 2015. The Nifty gained 242.05 points or 3.03 per cent to settle at 8,224.95, its highest closing level since June 2, 2015.
The BSE had dropped by 1,532.20 points or 5.48 per cent in the previous three weeks and the Nifty had also tumbled by 476.05 or 5.63 per cent in the same period.
The BSE Mid-Cap index rose 365.18 points or 3.61 per cent to settle at 10,487.12 and the BSE Small-Cap index rose 369.01 points or 3.49 per cent to settle at 10,942.79. Both these indices outperformed the Sensex.
Shares of Refinery, Auto, Consumer Durable, Healthcare, Captial Goods, FMCG and Banking sectors were the major gainers of the week.
Data showing acceleration in industrial production growth and easing of food price inflation helped key benchmark indices to register gains.
Besides, expectations that above-average monsoon rain will improve the odds for further monetary policy easing from Reserve Bank of India (RBI) also helped investors’ sentiments.
Reliance Industries (RIL) gained 12.07 per cent at Rs 996.50 and was the top gainer during the week. As per reports, a foreign brokerage has retained its buy rating on the stock on expectations of strong Q1 June 2015 earnings following strong gross refining margins.
Forex: The Indian rupee recovered by 51 paise to end at 63.55 against the American currency on fag-end selling of dollars by banks and exporters on expectation of resumption of foreign capital inflows in view of strong recovery in equity.
The rupee resumed lower at 64.15 per dollar as against the last weekend’s level of 64.06 per dollar at the Interbank Foreign Exchange (Forex) Market and dropped further to 21-month low to 64.3050 per dollar on initial dollar demand from importers amidst foreign capital outflows.
Foreign portfolio Investors sold shares net USD 399.31 millions during the first four days of the week.
But, it recovered afterwards to 63.5250 per dollar before ending the week at 63.55 per dollar, showing a gain of 51 paise or 0.80 per cent, on fag-end selling of dollars in view of rise in the equity market.
The sensex recovered sharply by 890.87 points or 3.37 per cent during the week on fresh buying on account of strong factory output, steady inflation and above normal monsoon till now.
Weak dollar against major world currencies globally after the Federal Reserve signalled it will move gradually once it starts tightening policy, supported the domestic unit.
Globally, the negotiation between Greece and its creditors will take centre stage for the financial markets. Greece, which has delayed a payment to IMF earlier this month, has to make the payment by June 30.
In these uncertain times, the only certain thing is negotiation will go down to the wire. Investors and economists across the world will be hoping for a last minute deal as world economy is not in a state to afford the Greece default.