Sensex rises 214 points, markets log weekly gain

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August 22, 2020 12:15 AM

Foreign portfolio investors (FPIs) have remained buyers of Indian equities with their inflow standing at $5.5 billion in total so far in August.

On a weekly basis, the markets posted impressive gains.On a weekly basis, the markets posted impressive gains.

Equities gained on Friday as investors flocked to banking and power stocks amid a rebound in global markets. The Nifty ended higher by 0.53% or 59.4 points to close at 11,371.6 whereas the Sensex rose 0.56% or 214.33 points to close at 38,434,72. On a weekly basis, the markets posted impressive gains.

The global markets reacted positively to the tech rally overnight in the US which led to the Nasdaq closing at a record high. The rally came despite weak economic data on jobless claims. The US’ weekly jobless claims were back above one million after declining for the last few weeks.

In Asia bourses in China, Hong Kong, South Korea and Taiwan ended higher by 0.5% to 1.98%.

The Nifty Bank outperformed the indices during Friday’s trading session as it rose 1.36% to close at 22,299.6. This is because of the gains made in banking stocks such as HDFC Bank, Federal Bank, Punjab National Bank, Bank of Baroda and State Bank of India.

A report by Jefferies said there is still room for the banking sector to grow. Jefferies said, “With only one Indian bank in the global top 100 and the private credit to GDP ratio at 50%, the banking sector still has a lot of room to grow and competition to increase. Technology investments are much needed though as shown by the large corporate loan defaults where analytics could help raise red flags early.”

Foreign portfolio investors (FPIs) have remained buyers of Indian equities with their inflow standing at $5.5 billion in total so far in August.

On Friday, the futures and options segment on the NSE witnessed a turnover of Rs 8.85 lakh crore, against the six-month average of Rs 14.9 lakh crore. The cash market saw volumes worth Rs 56,336.74 crore, against the six-month average of Rs 51,793.2 crore.

According to a report by Kotak Institutional Equities, most high-performance indicators have not improved meaningfully. In its report, the brokerage said, “Most high-frequency indicators did not improve meaningfully over the past week. Electricity consumption was modestly lower with CY2020 consumption 2% below CY2019 consumption level. Google mobility trends were flat on a week-on-week basis.”

Major gainers on the Nifty were NTPC, Powergrid Corporation, Asian Paints, HDFC Bank, and Hero Motocorp, which were up by 5.09%, 4.64%, 4.43%, 2.52% and 2.43%. Big losers were Zee Entertainment, Hindalco, Bharti Airtel, ONGC and Tata Steel, down by 3.7%, 1.6%, 1.25%, 1.1% and 0.9%.

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