Sensex touches four-month high, masks widerweakness

The benchmark Sensex on Monday rose to its highest level since September, in a late surge helped by gains in a handful of large-cap stocks, as investors digested the government’s last federal budget before the national ballot.

The S&P BSE Sensex rose 0.3 per cent, or 113 points, to close at 36,583 after falling as much as 0.7 per cent in early trade. The advance masked weakness in the broader market, with gauges of small and mid-cap shares falling at least one per cent.

Volume in the benchmark indexes was about 20 per cent less than the 10-day average at close. The government proposed allocating ~75,000 crore ($10.5 billion) a year for the cash plan for about 120 million farmers, and giving taxpayers ~18,500 crore of relief in the year to March 2020, Finance Minister Piyush Goyal said in his budget speech in New Delhi on Friday.

“Fund managers are now reviewing their allocation as the budget is over and the focus will now be the ever changing political equations,” said Jitendra Panda, managing director, Peerless Securities. “Indexes are likely to stay volatile and action will be very stock specific.”

Fourteen of 19 sector subindexes compiled by BSE declined, led by a gauge of utilities Reliance Industries gave the biggest boost to the benchmark index. The stock’s 3.5-per cent rises contributed to 140-point gain on the Sensex.