Stock markets extend recent gains to hit 2-1/2-month highs

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Mumbai | Updated: July 6, 2015 1:04:30 PM

BSE Sensex today rose by 147 points to again rally past 28,000-mark, largely driven by gains in banking and capital goods stocks on renewed buying interest by foreign investors and higher government spending.

BSE SensexBSE Sensex gained over 20 points after Thursday?s volatile session, despite lack of major global cues. NSE Nifty meanwhile dropped 8.15 points to 8,444.90. (Express Photo)

Indian shares hit their highest in 2-1/2 months on Friday and posted their third consecutive weekly gain given a Greece default is seen as factored in, while better-than-expected progress of the monsoon also helped sentiment.

Among gainers, HDFC Bank Ltd rose 1.5 percent on relative valuations, while drugmaker Lupin Ltd rose 1.7 percent after an acquisition in Russia.

BSE Sensex on Friday rose by 147 points to again rally past 28,000-mark, largely driven by gains in banking and capital goods stocks on renewed buying interest by foreign investors and higher government spending.

Reserve Bank Governor Raghuram Rajan’s comments that India’s exposure to Greece is limited also boosted sentiment.

In a statement yesterday Rajan said that he was confident of economic recovery, while adding that capital investments are picking up.

Meanwhile, foreign investors bought shares worth Rs 575.3 crore yesterday, according to provisional data.

Market Outlook by Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services
While world markets remain apprehensive about the upcoming Greek vote (05 July), India is holding on to its outperformance. On a positive note India is hovering at the important level of 8500 (Nifty). Apart from this event risk, India’s trajectory will depend on Q1FY16 results. Additionally, the fall in China’s equity market and news of the improvement in government spending are providing support to the Indian markets.

With an eye on improving farm productivity, the government decided to spend Rs 50,000 crore over the next five years under the Pradhan Mantri Krishi Sinchai Yojana (PMKSY).

The index brushed off losses in global markets ahead of the Greece referendum on Sunday. After a hesitant start, it recouped the 28,000-mark to hit the day’s high of 28,135.43 before settling at 28,092.79, showing a recovery of 146.99 points or 0.53 per cent.

The 50-share broader Nifty surged 40.00 points or 0.47 per cent to close at 8,484.90 after hovering between 8,497.75 and 8424.15 during the session.

Market View by Anand James, Co Head Technical Research Desk, Geojit BNP Paribas
With time till Sunday before more clarity emerges on the Greece debt crisis, domestic factors remained the dominant theme in Indian markets. Government’s announcements on agri sector caps cap a positive week for Indian market, which has seen economic data showing improvement in capex and core sector growth, and also key project announcements from the government. Amidst all this, PMI’s fall to a 15 month low, was ignored, as more key figures by way of IIP, CPI and WPI were scheduled for release next week. Importantly all these releases would be closely watched for consistency, and signals towards potential rate cut.

Stocks of housing finance company, HDFC, topped among Sensex gainers by surging 2.53 per cent to Rs 1,316.05, followed by Hero MotoCorp rising 1.77 per cent to Rs 2,577.80.

Shares of Lupin gained 1.64 per cent after the company announced acquisition of Russia’s Biocom, marking its foray into the Russian pharma market.

Other gainers on BSE include, HDFC Bank, BHEL, TCS, NTPC, Dr Reddy’s, Bajaj Auto, Cipla, Axis Bank, SBI, ICICI Bank, HUL, ITC, Maruti Suzuki, Sun Pharma and Infosys.

Market View by Gaurav Jain, Director, Hem Securities
Markets shut on a strong note adding buying till the last leg on the optimism that Greece crisis will be resolved and it will not impact much on Indian equities. Further, renewed buying interest of foreign portfolio investors; after the last month selling from; has boosted the sentiments.

On weekly basis, Sensex and Nifty has gone up by 280.95 points (1.01 per cent) and 103.80 points (1.23 per cent), respectively, completing their third straight weekly gain.

Sectorwise, BSE banking index gained the most by surging 0.76 per cent, followed by capital goods 0.57 per cent, FMCG 0.46 per cent, healthcare 0.41 per cent, consumer durables 0.33 per cent and IT 0.28 per cent.

Globally, Asian markets ended mixed and European stocks were down in their opening trade.

(With PTI & Reuters input)

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