Upward momentum building up in market
Rising for a ninth day in last ten, the Sensex advanced on Thursday as the earnings season continued to woo investors. The index ended 183.96 points, or 0.45 per cent, up at its new all-time high of 40,653.74, tracking gains in metal, energy and banking stocks.
The Nifty-50 Index closed above the 12,000 level for the first time since June 4. Nifty ended with a gain of 46 points, or 0.38 per cent, at 12,012.05.
Trading sentiment was bullish after the government on Wednesday approved a Rs 25,000 crore realty fund, which is expected to jumpstart consumption and give a boost to real estate and allied sectors. Strong corporate earnings and sustained foreign fund inflows also kept domestic market sentiment upbeat, analysts said. Twenty-two out of 35 Nifty-50 firms that have reported quarterly earnings so far this season have beaten or matched the average analyst estimate. Foreign investors have bought stocks worth $323 million in November, after pumping in more than $2 billion in the previous month.
Technical View
The Sensex’s 50-day moving average last week crossed above its 200-day line to form a so-called golden cross, which some analysts read as a sign that gains may continue.
Shrikant Chouhan, Analyst for Technical Research at Kotak Securities Ltd, said: “Most of the Nifty-50 companies’ results were better than or matching expectations, which has also increased optimism in the investor community, thus minimising downside for the market.”
Manav Chopra, Head of Equity Research at Indiabulls Ventures Ltd, said, “Momentum is building on the upside with wide participation, which is a good sign.”
Market View
Vinod Nair, Head of Research, Geojit Financial Services, said: “Reforms and earnings are the market drivers, the measures to support realty sector augers well for the sector to outperform. The proposed measure will help to start the recovery of stalled projects and can see a ripple effect in NBFCs, banks and cement sector…On global front, China agreed with US for phased removal of tariffs that has brightened hope for a trade deal and bring some cheer for markets across the globe.”