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Markets clock weekly gains for first time in 3 weeks

The benchmark BSE Sensex rose 0.7 per cent and the National Stock Exchange's Nifty 50 gained 0.9 per cent at the close in Mumbai

BS Reporter & Agencies  |  Mumbai 

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The benchmark gained 0.92 per cent on Friday, ahead of the outcome of the Goods and Services Tax (GST) Council meet. This rally helped register their first weekly gain in the past three weeks. The benchmarks gained 1.2 per cent during the week. Last week, they were down two per cent.
However, market participants caution that the situation could still be precarious, as foreign portfolio investors (FPIs) are continuing to take money off the table. FPIs have sold shares worth ~2,668 crore during the week.

Friday’s gain was led by metal stocks. The benchmark BSE rose 0.7 per cent and the National Stock Exchange’s 50 gained 0.9 per cent at the close in Mumbai. All 19 sector gauges compiled by BSE advanced, paced by the S&P BSE Metal Index’s 3.1 per cent rally. Tata Steel climbed 4.6 per cent to its highest closing since January 2011, after posting a quarterly surge in domestic sales. “There’s a lot of support for equities from domestic fund flows and once the pace of recovery for earnings begins, we will start seeing justification for the stock prices,” said Nitasha Shankar, senior vice-president and head of research at YES Securities (India).
“India is still better placed vis-a-vis emerging (EMs). Local funds were net buyers of Indian equities for 14 straight months through September, countering redemptions by foreign investors in the past two months. Companies will start reporting July-to-September earnings next week”.
Shankar expects 50 profits to rise as much as 13 per cent for the year through March 2018 and as much as 19 per cent in the next 12 months.
Vinod Nair, Head of research, Geojit Financial Services, said, “Market rebounded led by a surge in the metal stocks on account of rise in global commodity prices. Additionally, expectations from the GST Council meet to get reduction in rates and faster refund gave thrust to small-cap and mid-cap stocks to outperform. Global market remains positive due to better outlook on the US employment data and tax reforms.”
The gains in the broader market were in line with the benchmark indices. Also, there were nearly two advancing stocks for every one declining on the BSE.

First Published: Sat, October 07 2017. 01:52 IST