New record highs: Markets continue to rise, banking stocks shine
Mumbai, December 29, 2020
The improving economic scenario, along with healthy buying in private banking sector stocks, pushed India's key equity indices to breach new record intra-day and closing highs on Tuesday.
Besides, a small intra-day correction pulled in fresh foreign funds. The strong FII inflows have continued their holiday shopping and have relentlessly bought around Rs 43,000 crore worth of shares in December.
This continuous FII buying, barring one session this month, has supported the index at higher zones.
Positive global cues such as Brexit developments and the new US stimulus package along with upcoming roll-out of anti-Covid vaccine in emerging markets led to continuation of foreign fund influx.
On Tuesday, the foreign investors pumped in liquidity worth Rs 2,349.53 crore.
Globally, shares extended their year-end rally with Japanese stocks hitting a 30-year high.
Among sectors, private banks and IT gained the most, while metals and media were the main losers.
In the day's trade session, financial stocks led the market rally wherein lenders such as HDFC, Axis and ICICI were the main gainers.
The Sensex closed at 47,613.08, higher by 259.33 points, or 0.55 per cent, from its previous close.
The Nifty50 on the National Stock Exchange (NSE) ended at 13,932.60, higher by 59.40 points, or 0.43 per cent, from its previous close.
"Nifty continues its upward march with some intraday corrections. With no negative triggers expected on the horizon over the next few days, it could soon touch 14,000," said Deepak Jasani, Head of Retail Research at HDFC Securities.
"Advance decline ratio of almost 1:1 however suggests partial profit taking after a strong and sustained upmove."
Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services, said: "The Q3 corporate numbers will be the next key event for the market and is expected to be much better on the back of strong festival season."
"In the near term, we can see some volatility ahead of the monthly expiry on Thursday. The long term market structure remains positive."
Vinod Nair, Head of Research at Geojit Financial Services said: "It was a volatile day, started well but edged lower losing all the gains, in the end, the markets recovered much of the losses and closed with a small upside."
"Finance stocks were the major contributors in the upside but broader markets underperformed the main benchmark. Selling was seen in auto, pharma and metal sectors among others too."
"A major part of the global developments like stimulus and Brexit deal are priced in the market. In the absence of major domestic or global events expected in the near-term, the market will focus on the upcoming Q3 earnings and stock-specific updates."