Foreign fund inflows, better Q2 results lift equity indices

Foreign fund inflows, better Q2 results lift equity indices

Mumbai, November 6, 2020

Healthy foreign fund inflows, along with better than expected Q2 earnings results, lifted the Indian equity indices higher on Friday.

The day's trade also saw an inflow of Rs 4,869.87 crore.

Globally, stock markets were mixed after Italy and France reported a record number of coronavirus cases, while investors measured the implications of a political gridlock in the US on policy and stimulus.

Back home, volumes on the NSE were above recent average.

Among sectors, banks, energy, IT, realty and metals indices did well while FMCG and Healthcare came under pressure.

The Nifty50 on the National Stock Exchange closed at 12,263.55, higher by 143.25 points, or 1.18 per cent, from its previous close.

The Sensex closed at 41,893.06 points, higher by 552.90 points, or 1.34 per cent, from its previous close of 41,340.16.

"Nifty is just 167 points away from the all time high. Though it does not seem difficult at all going by the momentum seen over the last few days, global markets show signs of slowing down," said Deepak Jasani, Head of Retail Research at HDFC Securities.

"However, Q2 results from Indian corporates are better than expected that may lead Indian markets to outperform for some time."

Vinod Nair, Head of Research at Geojit Financial Services, said: "Positive global sentiment from the US election, expectation of US Fed open market operation and improving economic activities have added optimism."

"It can take Indian market to a new zone over-weighing worries over increasing Covid cases backed by a strong performance in sectors like banking, IT, Pharma and exporters. We expect this momentum to sustain aided by positive Q2 results, favorable economic data, strong FII buying and expectations of an additional stimulus package."

Siddhartha Khemka, Head, Retail Research, Motilal Oswal Financial Services, said: "Global cues continued to be positive as Democrat Joe Biden is seen leading over President Donald Trump in the S. election, while the Republicans are seen to retain control of the Senate. Further, the US Federal Reserve kept its key interest rate unchanged near zero and reaffirmed its readiness to do more to support the economy."

"On the domestic side, markets rallied in sync with its global peers, putting behind the uncertainties with regards to the US presidential election. Reliance Industries and HDFC Bank contributed over 50 per cent to Nifty's gain of 143 points. RIL gained 3.8 per cent after it secured a $1.3 billion investment in its retail business from Saudi Arabia's wealth fund at a higher valuation."


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