Sensex, Nifty touch new record highs; Nifty 34 points shy of 10k

The benchmark Sensex and Nifty on Monday ended at new record highs led by gains in index heavyweights Reliance Industries, HDFC Bank and ITC. The benchmark Sensex gained 217 points, or 0.68 per cent to close at 32,245.9, the 50-share Nifty rose 51.15 points, or 0.52 per cent to 9,966.4, less than 34 points from the coveted five-figure mark. During intra-day trade, the Nifty was just 18 points shy of hitting 10,000. 

Market players said stock-specific news in heavyweight counters led to Monday’s rally.

Shares of Reliance Industries (RIL) gained 1.9 per cent to end at Rs 1,616, an all-time closing high, due to optimism triggered by a new phone launch and a 1:1 bonus issue. RIL hit its previous all-time high on January 14, 2008 at Rs 1,608.

HDFC Bank also closed at a new record high of Rs 1,734.5, up 1.83 per cent, after the private sector lender posted a 20 per cent year-on-year (y-o-y) jump in June quarter net profits.
 

Wipro added another 1.9 per cent at Rs 291.8 after it announced a Rs 11,000-crore buyback, while ITC gained 1.6 per cent to close at Rs 293.2 after it increased cigarette prices. 
 

Investor sentiment was also boosted by the latest IMF report which retained India's growth projection at 7.2 per cent for FY18. 

“Nifty has almost reached 10,000 and it is much on expected lines. Now, we expect consolidation or profit-taking ahead. Some of the index majors will announce their numbers during the week and that would dictate the market trend. Also, we've derivatives expiry scheduled ahead so rollover and unwinding will add to the volatility,” said Jayant Manglik, president-retail distribution, Religare Securities.

The July derivatives contracts expire on Thursday. Experts say the market could stay positive ahead of the expiry due to unwinding of short positions held by participatory notes due to curbs imposed by markets regulator Securities and Exchange Board of India (Sebi).

“It is the liquidity that is driving the market. India’s growth prospects and government efforts to improve fundamentals provides it an upside for investment. Inflows, both domestic and foreign flows, remain strong, which has stretched valuations. However, we aren’t in bubble territory,” Devam Modi, research director at Equirus Securities, told Bloomberg. 

Both foreign institutional investors (FIIs) and domestic institutional investors (DIIs) have been huge buyers in the market this year. 

Foreign inflows have picked up pace as emerging markets continue to benefit from the US Federal Reserve’s paced rate increases, while Indian savers are shifting more money to financial assets as prices of gold and property have cooled after the government’s ban on high-value currency notes.

On Monday, overseas investors were net sellers to the tune of Rs 367 crore, while domestic investors bought shares worth Rs 669 crore, provisional data provided by stock exchanges showed.