1. Five factors that may drive Nifty to 10000 today

Five factors that may drive Nifty to 10000 today

The broader benchmark index, Nifty 50 is on its way to hit 10,000 today. The 50-share barometer rose as much as 53 points to clock a fresh record high of 9,968.95 points while the index opened 21 points higher at 9,936.89 points.

By: | Updated: July 24, 2017 12:17 PM
The 50-share barometer opened 21 points higher at 9,936.89 points. (Image: NSE)

The broader benchmark index, Nifty 50 is on its way to hit 10,000 today. The 50-share barometer rose as much as 53 points to clock a fresh record high of 9,968.95 points while the index opened 21 points higher at 9,936.89 points. The major gains in the shares of blue-chip companies Reliance Industries, FMCG major ITC, Infosys, ICICI Bank and SBI which contributed heavily helped the indices scale new peaks in early trade. BSE Sensex also hit a record high rising over 200 points register a peak of 32,232.63 points.

Here are the five reasons which may drove Nifty to 10,000:

Earnings optimism:

The optimism of better than expected earnings for the first quarter of the financial year 2017-2018. Today five constituent of NSE Nifty 50 are lined up with the earnings for the April-June quarter with the most valuable domestic private sector lender HDFC Bank, major cement manufacturer Ambuja Cements, the telecom tower and infrastructure provider Bharti Infratel, one of the leading housing finance company Indiabulls Housing Finance, and the domestic media company Zee Entertainment.

Swelling up of forex:

The country’s foreign exchange reserves rose by USD 2.681 billion to touch a new life-time high of USD 389.059 billion in the week to July 14, helped by an increase in foreign currency assets (FCAs), RBI data showed. In the previous week, the reserves had marginally declined by USD 161.9 million to USD 386.377 billion. Gold reserves remained unchanged at USD 20.348 billion.

Foreign Portfolio Investors influx:

Overseas investors have pumped in USD 2.4 billion in the capital markets this month, enthused by the trouble-free roll-out of GST and on hopes of better corporate earnings, taking the total to USD 25 billion so far this year. According to latest depository data, FPIs invested a net Rs 2,977 crore in equities during July 3-21, while they poured Rs 12,371 crore in the debt markets review, translating into a net inflow of Rs 15,348 crore. The latest figures show a net infusion of Rs 1.6 lakh crore in the previous five months (February-June) on several factors. In January, they had pulled out over Rs 3,496 crore.

Rate cut expectations:

There are now renewed hopes of a rate cut by the Reserve Bank at its policy meet next month after retail inflation hit a low level of 1.54% in June and industrial output growth slumped to 1.7% in May. “The number of 1.54% is historically low and reflects the firm and ongoing consolidation of macroeconomic stability,” Chief Economic Adviser Arvind Subramanian told reporters. “The last time we saw such inflation — according to slightly different CPI (IW) — was in 1999 and before that in August 1978,” he added.

Blue-chips hitting 52-week highs:

Shares of heavyweight companies Reliance Industries, Wipro, ICICI Bank recently made new 52-week highs after the oil-to-telecom conglomerate Reliance Industries Ltd launched the Jio Phone and cable TV while the major IT companies gained on the back of proposed share buybacks in order to distribute the extra cash reserves on their books with the most recent announcement coming from Wipro of worth Rs 11,000 crore.

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