Profit booking pulls equity indices from record highs

After touching record highs during the early morning session, the key Indian equity indices succumbed to profit booking and traded with marginal losses during the mid-afternoon session on Tuesday.

Expectations of healthy quarterly results, coupled with broadly positive global cues, lifted both the NSE Nifty and BSE Sensex to experience "gap-up" opening from their previous session's close and touch new record highs during early hours of trade.

Besides, factors such as hopes of a lending rate cut by the Reserve Bank of India in its next policy review meet, along with inflows of foreign funds and consistent projection of healthy economic growth, enhanced investors risk taking appetite.

At 1 p.m., the wider Nifty of the National Stock Exchange (NSE) traded 15.90 points or 0.16 per cent lower at 9,950.50 points.

The Nifty, which breached the 10,000-points level during the day's early trade (at 9.15 a.m.) just after the pre-open session, touched a high of 10,011.30 points during the intra-day trade.

The 30-scrip Sensitive Index (Sensex) of the BSE, which opened at 32,350.71 points, traded at 32,205.13 points -- down 40.74 points or 0.13 per cent -- from its previous close at 32,245.87 points.

The Sensex has so far touched a high of 32,374.30 points during intra-day trade.

"India's NSE Nifty index hit the 10,000-mark for the first time on Tuesday, further cementing its position as one of Asia's best performing stock market gauges. Indian shares have hit multiple records this year amid optimism about Prime Minister Narendra Modi's policies, with the economy expanding at about seven times the pace of Japan," Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS.

"Overseas investors have bought $20.2 billion worth of local bonds so far in 2017, according to depository data. A big factor for the phenomenal rise in stock value has been the shift of Indian savers to more financial assets as prices of gold and property moderated after the government's ban on high-value currency notes," Desai added.

On Monday, the benchmark indices were lifted to new highs on the back of healthy quarterly results, coupled with intense buying activity witnessed in index heavyweights such as HDFC Bank, Reliance Industries (RIL), ITC and Infosys.

The Nifty rose by 51.15 points, or 0.52 per cent, to close at a fresh high of 9,966.40 points, after it touched a record high of 9,982.05 points during intra-day trade.

Similarly, the Sensex closed at a new high of 32,245.87 points -- up 216.98 points, or 0.68 per cent. It touched a record intra-day high of 32,320.86 points.

--IANS

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