Markets gain on back of US Fed meeting minuets showed continue support to economy

Written by fe Bureau | Mumbai | Updated: May 22 2014, 20:41pm hrs
Indian MarketBSE Sensex had slipped from record highs by falling 78.86 points in yesterday's trade, recovered by 125.37 points, or 0.52 per cent, to trade at 24,423.39. (AP)
Benchmark indices advanced on Thursday after minutes of the Federal Open Market Committee's April meeting showed that the US Fed would continue to support the US economy.

"The committees discussion of this topic (normalization of monetary policy) was undertaken as part of prudent planning and did not imply that normalization would necessarily begin sometime soon," the minutes said.

The BSE benchmark, the Sensex was trading 0.32% or 77.57 points higher at 24,375.59 points, while the NSE's Nifty was trading 0.31% or 22.80 points higher at 7,275.70 points at 2.30 pm IST.

Experts believe this is the beginning of a bull market. "Empirical evidence suggests that market returns mirror corporate earnings growth. As earnings growth recovers to approximately 20% over the next three-four years, valuations will also tend to trade above average of 15x," Motilal Oswal Securities said in a note.

Among sectoral indices, the BSE Consumer Durables (6.92%), BSE Metal (1.45%) and BSE Realty (6.32%) were the major gainers. Among individual stocks, Coal India (4.59%), Maruti Suzuki (4.48%) and NTPC (3.19%) were the major gainers on the 30-share Sensex.

Most Asian indices were trading in the green. The Nikkei (2.11%), Hang Seng (0.51%), Kospi (0.36%), Taiwan Taiex (1.21%) and Jakarta Composite (1.14%) were the major gainers.