SENSEX ENDS ABOVE 34000 MARK FOR THE FIRST TIME EVER

Indian stocks hit a record high, with the benchmark Sensex breaching the 34,000-point mark for the first time on Tuesday, spurred by abundant liquidity support and positive investor sentiment as the year draws to a close. The BSE Sensex rose 0.21% to end trading at a new high of 34,010.61 points while the National Stock Exchange’s Nifty gained 0.37% to 10,531.50.

Most global markets were flat as trading thinned due to yearend holidays in several regions of the world.

The markets are rallying on positive sentiment driven by hopes of revival in quarterly corporate earnings and a favourable Budget, said Gaurang Shah, vicepresident at Geojit Financial Services Ltd. “Markets are expected to hit multiple highs ahead.”

Most analysts expects stocks to extend the rally in 2018. Corporate earnings are likely to revive strongly in the coming months, owing to a low base and an expected recovery in economic growth, said Hemang Jani, senior vice-president, advisory, at Sharekhan, a brokerage owned by BNP Paribas SA. “Earnings of Sensex firms are expected to grow, aided by strong performance of automobiles, banking and energy sectors. Some of the consumer firms have reported encouraging Q2 numbers while management commentary indicates signs of demand revival.”

Disappointing earnings growth this year have raised concerns that stock valuations are expensive. Steep valuations have not deterred foreign institutional investors (FIIs) from pumping money into Indian equities. Year to date, FIIs bought a net of $7.71 billion of Indian shares. They sold $1.04 billion in December. Domestic institutional investors (DIIs) have bought stocks worth ₹90,809 crore in 2017, including ₹8,117 crore in this month.

The markets have gained sharply this year with the benchmark indices rising 27-28% in 2017, while MSCI EM gained 32% and MSCI World was up 20% during the period.

MUMBAI: