Positive global cues cheer markets, Sensex up 133 points

Healthy growth in Chinese exchanges and the US economy, coupled with attractive valuations, buoyed investor sentiment in the Indian equity markets and propelled a barometer index to gain 133 points during the late-afternoon trade session on Friday.

The positive sentiments propelled the barometer 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) to gain 133 points or 0.51 percent.

Bullish sentiments were witnessed at the wider 50-scrip Nifty of the National Stock Exchange (NSE). The CNX Nifty of the NSE rose 36.40 points or 0.46 percent at 7,985.35 points.

The S&P BSE Sensex which opened at 26,542.84 points, was trading at 26,354.33 points (2.45 p.m.)-- up 133.14 points or 0.51 percent from the previous day's close at 26,231.19 points.

The S&P BSE Sensex touched a high of 26,687.33 points and a low of 26,301.28 points in the intra-day trade so far.

Analysts point out that the positive cues eminating out of Chinese markets and strong economic growth data from the US cheered the markets.

"The rally from yesterday has been extended on the back of strong US GDP data, which was better-than-expected. This led to a strong closing in the US markets on Thursday," Anand James, co-head, technical research, Geojit BNP Paribas, told IANS.

The US economy expanded by 3.7 percent in the quarter ended June, which was better-than-expected, given the earlier estimate of 2.3 percent. The rise in growth rate supported the US markets which made healthy gains on Thursday.

Thursday's growth in the US markets build-upon the gains achieved on Wednesday, when the exchanges there had made their biggest single day gains in four years.

The Chinese markets too showed signs of recovery. The benchmark Shanghai Composite Index was trading up 4.90 percent on Friday. It had closed with gains of 5.40 percent on Thursday, after a consecutive five days of losing streak.

"The Asian markets have also been on the positive side and this has provided relief and support to the Indian equities. Rupee is also stabilising," James added.

The massive implosion in the Chinese markets which by some estimates have eroded 40-45 percent of the entire stock value had caused the steepest fall in the Indian barometer index on Monday.

The S&P BSE Sensex had lost as much as 1,624.51 points, or 5.94 percent -- which was the steepest in terms of points on Monday.

The massive fall on Monday had sharply reduced prices and gave an opportunity for bargain hunting and value buying by the domestic investors, said Devendra Nevgi, chief executive of ZyFin Advisors.

"The market correction has sharply reduced prices and led to value buying at lower levels. This has supported the ongoing positive bias in the market," Nevgi elaborated to IANS.

Sector-wise, healthy gains were made in information technology (IT), automobile, oil and gas, metal and fast moving consumer goods (FMCG). However, banking, consumer durables and realty sectors came in for heavy selling pressure.

The S&P BSE IT index increased by 195.77 points, the automobile index augmented by 102.93 points, oil and gas index gained by 38.02 points, the metal index rose by 28.67 points and the FMCG index edged-higher by 28.31 points.

On the other hand, banking index plunge 102.25 points, consumer durables index receded by 27.75 points and realty sector was lower by 11.56 points.