Indian markets on Tuesday gained for a third consecutive day, with the benchmark indices gaining about 0.4%, led by index heavyweight Reliance Industries, which contributed to the majority of the index gains.
Despite initial weakness and intense volatility, the benchmark indices managed to close with gains thanks to some late buying in select blue-chips stocks.
Reliance Industries, India’s largest company in terms of market capitalisation, rose 2.9%, the most since December 10, 2010. All Anil Ambani group companies closed with gains, with Reliance Capital advancing 9%, Reliance Communications adding 4.4%, while Reliance Power inching up 3%. “Last few days markets have firmed up a bit as valuations had become very attractive. Bulk of the things seems to have been factored in and so possibly we are in for a rebound,” said Rakesh Arora, head of research, Macquarie India.
The Sensex gained 0.39% or 71.60 points to 18,273.8, with about 16 its components closing with gains. Meanwhile, the 50-share Nifty added 0.46% or 25 points to 5,481. “Firm global cues and slight moderation in inflation have lifted the mood slightly even as the government tries to break the protracted political standoff,” said Amar Ambani, head of research at IIFL. “The market may sustain the gains for a while but don’t bet on a secular rise.”
As per provisional figures by NSE, FIIs net bought stocks worth Rs 233 crore, while their domestic counterparts net sold worth Rs 168 crore. After investing a record $29 billion in 2010, FIIs have sold shares worth more than $1.7 billion in this calendar year. An improvement in economic conditions in the developed world has seen foreign flows moving out of India to more export-dependent countries.