Record run continues for Sensex, Nifty
THE 30-SHARE SENSEX SETTLED 413.45 PTS HIGHER AT 41,352.17, WHILE THE BROADER NIFTY ROSE 111.05 PTS TO 12,165 ON TUESDAY
MUMBAI: Indian stocks surged 1% to an all-time high on Tuesday, tracking a rally in global markets that were cheered by the US suspension of additional tariffs on China.
Sentiment also improved after RBI governor Shaktikanta Das said on Monday that there was scope for cutting interest rates further and that the central bank would use it whenever required after studying growth and inflation data. BSE’S benchmark Sensex advanced 413.45 points, or 1.01%, to close at a record high of 41,352.17. The National Stock Exchange’s Nifty 50 index climbed 0.92% to its highest level of 12,165 points. Earlier in the day, Sensex gained as much as 1.13% to 41,401.65, while the Nifty advanced 1.07% to 12,182.75.
Investors are now awaiting the outcome of the Goods and Services Tax (GST) Council meeting on Wednesday. They are also hoping that in the Union budget to be presented on February 1 the government will announce more measures to stimulate economic growth, which slowed to a sixand-a-half-year low of 4.5% in the September quarter.
“Positive global sentiments, buoyed by easing trade war tensions between the US and China, continue to pump the market,” said Vinod Nair, head of research at Geojit Financial Services. “Economic growth remains on the lower side, while risk appetite of investors is gradually improving on expectation of further steps from the government in the upcoming budget to revive consumption and attract investsteel ments.” Global markets also soared, with indexes in the US, China, Japan and Hong Kong closing 0.4-1.2% higher.
The BSE Metal index surged 3% on news of the US reaching an in-principle trade deal with China. Brokerage firm Citi Research said global steel prices are likely to rise on signs of China easing monetary and government policies. A demand upswing in India also pushed metal stocks higher.
Among metal stocks, Jindal and Power Ltd, Tata Steel Ltd, Steel Authority of India, Vedanta Ltd, Hindalco Industries Ltd and JSW Steel Ltd climbed 2-7%. Banking stocks rallied, with the Bank Nifty also reaching record highs on expectations of better earnings in the December quarter, following the insolvency resolution of some high-profile cases. Lenders are expected to recover ₹54,000 crore from four failed companies—essar Steel, Prayagraj Power Generation, Ruchi Soya and Rattanindia Power—that should be completed by the end of December, according to a Bloomberg report.
Some analysts still advised caution because of apprehensions that pan-india protests against the citizenship amendment law might shift the government’s focus away from the weakening economy.