BSE Sensex hits 30,000 in late noon deals

Maruti Suzuki, Reliance Industries, Adani Ports, Bharti Airtel among top Sensex gainers

S&P BSE Sensex reclaimed the 30,000 mark in late noon deals to hit an intra-day high of 30,007.48 levels. It, however, pared gains as trade progressed to trade 70 points, or 0.2%, higher at 29,972 levels at 2:45 pm. The Nifty50 index, on the other hand, traded 23 points higher at 9,260 levels.

"The Nifty50 index traded at life-time high this morning, while the S&P BSE Sensex crossed 30,000. The sentiment is euphoric. Liquidity flow has been robust, which has also led to frenzied buying in mid-and small-cap stocks. Based on one-year forward earnings, the Nifty is trading at around 18.10x PER based on our estimates," said Dharmesh Kant, Head – Retail Research, Motilal Oswal Securities in a note.

"The macro backdrop remains conducive – the fiscal and monetary metrics are encouraging, and the BJP’s strong showing in the recent state elections should provide tailwinds for further reforms. Nifty can be expected to hit 10,000 levels in FY18," he adds.

Among individual stocks, Maruti Suzuki gained over 4% to Rs 6337 levels on the S&P BSE Sensex. Analysts at Motilal Oswal Securities have a 'buy' rating on the stock with a target price of Rs 7,443. They believe the Gujarat plant will ease capacity constraints and help Maruti to drastically reduce waiting periods for products like Baleno, Brezza and Ignis.

Adani Ports, Reliance Industries (RIL), Larsen & Toubro, Hindustan Unilever, Axis Bank, Tata Steel and Bharti Airtel were some of the other gainers on the S&P BSE Sensex that moved up 1.4% - 4.2%.

"The Sensex hitting the 30,000 mark is in line with overall positive sentiment in the market, which has been riding on the passage of GST Bill and the strengthened position of govt after the assembly elections. Improved macro-economic numbers such as sharp reduction in current account deficit are resulting in lot of funds flowing into Indian equity- both from domestic and global institutions," said Kunj Bansal - Executive Director & CIO – Equity , Centrum Broking.

Adding: "The buying interest is not only in large caps but is there in mid and small caps as well which have actually outperformed large caps. Going fwd, market would be keenly looking for trends from the March quarter numbers."

RBI policy

The monetary policy committee (MPC) of the Reserve Bank of India (RBI) is likely to leave the repo rate at 6.25% on Thursday, where it has been since October, a Reuters poll found.

However, investors are expecting the RBI to announce measures to drain the Rs 4 trillion that has accumulated in the banking system in March, double as compared with January.

"We expect the RBI to keep policy rates on hold on April 6. On commentary, it could well choose to tread a middle path - acknowledge that global pressures have abated, but in the same breath stress that domestic uncertainties remain. Markets may view this as dovish on the margin. But we believe that it has not brought the RBI any closer to a rate cut. As mentioned before, the bar for another rate cut is high," says Pranjul Bhandari, chief economist, India at HSBC in a note.

OIL PRICES

Oil climbed to a near one-month high on Wednesday on signs of a gradual tightening in global oil inventories and on concerns about a supply outage at a field in the United Kingdom's North Sea that feeds into an international benchmark price.

Brent crude futures, the international benchmark for oil, were at $54.52 per barrel at 0658 GMT, up 35 cents, or 0.65%, from their last close.

(With Reuters inputs)