Sensex rises 357 points; MCX gains 26% on debut
India is a developing country but a huge economic divide poses a major challenge to its growth. The gap between the have's and the have's not is widening continously but solution to the problem can't be seen in the near future.
India's benchmark indices made a strong comeback Friday to snap a three day losing streak. The BSE Sensex surged 357.72 points or 2.1% to close at 17,503 today on the back of positive global cues. The Nifty ended 113 points higher at 5,333.
Despite strong gains, markets were unable to wipe out previous losses during the week. The Sensex ended 133.5 (-0.76%) lower for the week while the Nifty declined 26 points or 0.5%.
"The rally was expected because we missed the global market rally because of Holi," Radhika Gupta, Co-Founder/Director, Forefront Capital Management told NDTV Profit today.
Greece managed to secure a deal with private creditors to accept haircut on their bonds. The move cleared the way for the debt laden country for further bail out money from the EU and IMF. The Nikkei 225 index in Japan hit the psychological 10,000 mark today. However, European markets traded with a negative bias.
Two stocks were in focus today. The Multi Commodity Exchange (MCX) saw a blockbuster listing. It listed with a premium of 34% over its issue price of Rs 1,032. The stock rose 38% to make an intraday high of Rs 1,426 before profit booking set in. MCX shares ended 25.68% higher at Rs 1,297 on the Bombay Stock Exchange.
"The stock looks fully priced at these levels. Upsides from here may not be too much. The commodities transaction tax (CTT) may be introduced in the Budget which will change the valuation parameters for MCX. Selling may come in from HNIs who bought the IPO on marginal funding," Ambareesh Baliga, Chief Operating Officer of Way2Wealth told NDTV Profit today.
Shares of Financial Technologies India Limited (-6%), the promoter of MCX, saw a sharp selloff today.
L&T (5.2%) rose sharply after the company appointed K Venkataraman as its CEO and MD and said that A M Naik would remain Chairman for next five years. "The continuation of Mr Naik as the Chairman of L&T is a positive move," Gupta said.
Metal stocks (4.7%) saw a sharp reversal in fortunes today. These stocks had been under selling pressure for most of the week. Tata Steel (7.4%) was the top Nifty gainer followed by JSPL (7.1%). Sterlite Industries (4.9%) and Sesa Goa (4.4%) also saw strong gains. Another Vedanta Group stock - Cairn India (5.1%) was among the top Nifty gainers.
Banking (3.66%) and capital goods (3.75%) also saw buying interest. ICICI Bank (6.2%), Axis Bank (4.2%) and SBI (3.96%) witnessed strong gains.
Defensive stocks like IT and FMCG saw some profit booking. Wipro was the top Nifty loser (-1.8%). Infosys (-1%), ITC (-0.8%) and HUL (-0.7%) were among the eight stocks to end lower on the Nifty index today.
The market breadth was strong with 83% stocks rising on the broader BSE 500 index.
Analysts said upsides in the markets are likely to continue on the back of sustained influx of liquidity.
"The Greek problem has been postponed further so there is some rejoining. More important for us is Europe is not going to be centre of attention for quite some time now. We have almost $1.5 trillion coming to EU zone. Even in December, when the first tranche of LTRO came, that's when markets bounced up 20 per cent. I don't see any reason why LTRO 2 should be any less potent," UR Bhat, Managing Director of Dalton Capital told NDTV Profit today.