Sensex, Nifty hit new high as monsoon, reforms drive markets

Indian markets continued their dream run with Sensex and Nifty Friday galloping to new peaks as the onset of the southwest monsoon and hopes of hike in natural gas prices attracted fresh funds from overseas investors betting big on a economic revival under the new government.

The market tempo was upbeat for the second day in a row, pushing up key indices to uncharted waters as the Sensex logged a new all-time intra-day high of 25,419.14 and settled for the day at a new closing high of 25,396.46, up 376.95 points or 1.51 per cent.

The Sensex surpassed its previous all-time high of 25,375.63 registered on May 16 and its previous record close of 25019.51 hit on June 5. On weekly basis, it has bounced back by a whopping 1,179.12 points or 4.89 per cent.

Similarly, the wide-based 50-issue CNX Nifty of the NSE also jumped 109.30 points, or 1.46 per cent, to end above 7,500-mark for the first time at 7,583.40. It also crossed its all-time intra-day high of 7,563.50 hit on May 16.

On global front, overnight decision of the European Central Bank to cut its benchmark interest rates to unprecedented lows to pump money into the sluggish euro zone economy. This also boosted domestic market sentiments.

"Markets rose sharply for the week, reaching new all?time highs. Announcement of stimulus by ECB and continued optimism on economic reforms in India led to big gains. Expectations of resolution to the gas pricing issue helped stocks like RIL and ONGC register gains. We see the monsoon progress and the budget to be the two important triggers," said Dipen Shah, Head- Private Client Group Research, Kotak Securities.

Foreign Institutional Investors (FIIs), key drivers of the recent bull run, picked up shares worth Rs 1,368.97 crore Thursday, as per provisional data with stock exchanges.

Nine of the twelve of the sectoral indices ended in the green. Realty, oil&gas and banking shares led the surge.

There was broad-based buying witnessed in the markets.

Market breadth remained positive as 2,144 stocks closed with gains while 959 ended lower. The BSE Small and midcap indices jumped about 1.6 per cent each.

"Sustained buying activities by funds and retail investors have kept markets near life time high levels," said Jayant Manglik, President-retail distribution, Religare Securities.

Onset of Monsoon is expected to ease prices of food grains, helping RBI to control sticky inflation, say experts.

Investors heavily bought oil&gas shares after reports said government is likely to hike natural gas rates from July 1 after a new price formulation is approved by Cabinet.

Globally, Asian stocks closed mixed with downward bias.

Key indices from Japan and Singapore closed with gains while from China, Hong Kong, South Korea and Taiwan finished lower.

European markets, however, were trading better in late morning deals. France's CAC was up 0.07 per cent, Germany's DAX up 0.20 per cent and the UK's FTSE up 0.26 per cent.

US stocks rose to records Thursday as European Central Bank stimulus boosted optimism in the global economy before a key US jobs report.

Back in Sensex, 24 of 30 counters closed in the green while others finished in the red. ONGC was top gainer with a rise of 10.57 per cent, followed by Gail India 7.52 per cent, Hero MotoCorp 3.68 per cent, RIL 2.97 per cent, HDFC 2.96 per cent, M&M 2.53 per cent and Bajaj Auto 2.31 per cent.

Cipla 2.21 per cent, Dr Reddy's Lab 1.79 per cent, ICICI Bank 1.42 per cent, Axis Bank 1.39 per cent, Wipro 1.34 per cent, SBI 1.31 per cent, HDFC Bank 1.25 per cent, HUL 1.14 per cent and ITC 1.06 per cent also gained handsomely.

However, Sesa Sterlite dipped 2.53 per cent, Infosys 1.26 per cent and TCS 1.02 per cent among Sensex laggards.

Among the S&P BSE sectoral indices, Realty rose by 5.02 per cent, followed by Oil&Gas 4.82 per cent, Bankex 1.65 per cent, Consumer Durables 1.61 per cent, Auto 1.53 per cent, Healthcare 1.39 per cent and FMCG 1.30 per cent.

Total market turnover rose further to Rs 5,177.14 crore from Rs 4,906.75 crore Thursday.

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