Sensex at new high on FII inflows

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Buoyed by strong inflows from foreign institutional investors (FIIs), on the back of a lower current account deficit, easing inflation and hopes of a stable government at the centre, the sensex on Thursday closed at its all-time high of 21514, up 237 points or an increase of 1.1%. Besides, it also touched a fresh intra-day record high of 21,525.

Investors were richer by nearly Rs 84,000 crore due to the market rally on Thursday. The sensex surpassed its previous closing high of 21,374 points set on January 23, 2014.

Riding high on the twin impact of expected stability and better macroeconomic indicators, FIIs net bought (higher purchase than sales) stocks to the tune of Rs 1,297 crore, BSE data showed. They have net bought shares worth Rs 2,300 crore in March alone.

Realty and power were the biggest gainers among sectoral indices which closed up 4% and 2.5%, respectively. Barring the healthcare sector, which closed down by around 0.3%, all other sectors ended in the green. In all, 146 stocks hit their 52-week high on the BSE. JP Associates and DLF were among the biggest gainers for the day, closing up around 8.5% and 58%, respectively. Cipla and Wipro were among the losers and ended down around 1.3% and 1%, respectively.

According to market observers, what added to the optimism was the falling temperatures in the geopolitical tension between Russia and Ukraine as a result of which even global markets have reacted positively.

"The market has hit a new high on the basis of strong FII flows as well as increasing retail participation," said Motilal Oswal, chairman and managing director, Motilal Oswal Securities. The markets remained in the positive zone throughout the day on the back of an upswing in the global markets and strong FII inflows. "The current account deficit data which came out yesterday was a positive one which added support to the rupee and to the markets," said Alex Mathews, Head, Research, Geojit BNP Paribas Financial Services.

The nifty opened above the highest of the previous day and remained firm throughout the day and closed at an all-time high of 6,401 points, rising 1.2%. It closed above the magic level of 6,360 for the first time since December 9. "The nifty has the next resistance only in the region of 6,600 and in the past we have observed that whenever the market crosses new highs it rallies by at least 5% above it," said Shrikant Chouhan, head, Technical Research, Kotak Securities. "Any correction from current levels will be an opportunity to buy around 6,350/6,360. Buying is advisable into metal and telecom stocks," he said.

The market breadth was positive with 1,664 stocks advancing against 1,074 stocks declining on the BSE. The volatility index stood at 14.47, down around 4.6%.