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Sensex hits record high; Nifty breaches 9,800


By Arnab Paul

- Indian hit a record high for a second consecutive session on Tuesday tracking gains in global markets, with the breaching 9,800 points for the first time as trading turned normal a day after a major technical disruption.

Volumes recovered on the NSE, with traders reporting no issues with placing trades or quotations. A technical glitch had disrupted trading at the country's largest exchange on Monday for five hours.

Domestic tracked Asian peers, which gained on Tuesday after rallied overnight on robust economic data from Germany and renewed interest in U.S. technology spurred by an Amazon Prime online sale event.

Traders also attributed the rise to unwinding of short positions in futures and options after market regulator Securities and Exchange Board of banned the use of offshore derivative instruments such as participatory notes (P-notes) that track other derivatives.

"With SEBI issuing a circular that all naked positions in derivatives by P-notes to be wound up, and with most F&O contracts not being long term, everything has to be wound up in three-four days," said Rakesh Tarway, head of research at Reliance Securities.

"There are lot of shorts built in like TCS Ltd and Infosys , and when the positions are wound up, there will be a rally," Tarway explained.

The rose as much as 0.56 percent to a record high of 9,825.8. It was trading up 0.54 percent at 9824.3 as of 0713 GMT.

Meanwhile, the benchmark rose as much as 0.48 percent to an all-time high of 31,868.6.

Among gainers, sugar surged after India, the world's largest sugar consumer, raised import tax on sugar to 50 percent from 40 percent in an effort to curb cheaper imports.

IT continued to rally with Infosys Ltd gaining 2.5 percent. The United States, the sector's biggest export market, announced better-than-expected jobs data for June on Friday.

Among decliners, of carrier SpiceJet Ltd fell as much as 3.7 percent on media reports of former promoter Kalanithi Maran seeking 20 billion rupees ($310.16 million) compensation from the company.

($1 = 64.4825 Indian rupees)

(By Arnab Paul in Bengaluru; Editing by Sunil Nair)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)