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Bull run continues: Sensex rises 680 points, Nifty settles at 12,631

Sensex jumps 1.6%, extends Nov gains to 9.3%

Topics
stock market trading | Markets Sensex Nifty | stock market rally

Sundar Sethuraman  |  Thiruvananthapuram 

People walk past the Bombay Stock Exchange (BSE) building in Mumbai. Photo: Reuters
People walk past the Bombay Stock Exchange (BSE) building in Mumbai. Photo: Reuters

The benchmark indices logged fresh all-time highs on Tuesday after promising trial results for a Covid-19 vaccine provided further ammunition to the bulls.

Joe Biden’s victory in the US Presidential elections have already turbocharged the global The Sensex closed at 43,277, up 680 points, or 1.6 per cent. The index has gained 3,664 points, or 9.3 per cent this month.

The Nifty50 rose 170 points, or 1.4 per cent, to end at 12,631. Both indices on Monday had surpassed their previous lifetime highs hit on January 17.

While the headline indices posted strong gains, sectors that have outperformed this year — such as information technology (IT) and pharmaceutical - fell, while those that lagged the market, such as financials, hospitality, and aviation, rallied sharply.

The BSE IT and Healthcare indices fell nearly 4 per cent each. On the other hand, stocks such as Indian Hotels, Lemon Tree Hotels, InterGlobe Aviation, and Bajaj Finance dominated the leaderboard.

A similar trend was seen on the Wall Street on Monday, where firms such as Zoom and Netflix— seen to be benefiting from the stay-at-home theme - tanked, and airlines, cruise lines, and energy companies jumped.

ALSO READ: Sensex touches 43,000-mark for first time; NSE Nifty tops 12,600

"Now that there is a breakthrough in the vaccine, there is a rally in the hospitality and aviation stocks globally, as there is scope for revival in these businesses. At the same time, the businesses which were benefiting from Covid saw profit booking. But this is a knee-jerk reaction and will last for a few days. Those which rallied on Tuesday will not see positive movement unless their revenues pick up," said Siddhartha Khemka, head-retail research, Motilal Oswal Financial Services.

Market players said the on the breakthrough in the vaccine would be a shot in the arm for the global economy.

"The global financial experienced a wave of euphoria over the potential breakthrough in the vaccine development. Indian indices moved in sync with global peers, touching fresh highs with continued support from banking stocks. An uptick in beaten-down stocks and sectors is on hopes of recovery in the business. The existing momentum can sustain on vaccine development, the domestic stimulus package, consistent foreign institutional investor inflows, and a bounce in globalisation after the Biden victory. However, temporary correction due to profit booking cannot be ruled out because the market is highly optimistic that the vaccine development will rapidly improve the ground reality" said Vinod Nair, head of research, Geojit Financial Services.


ALSO READ: India capable of strengthening cold chain for Pfizer vaccine: Health secy

The sharp upmove in the market in recent weeks has been underpinned by robust capital flows. So far this month, foreign portfolio investors (FPIs) have pumped in close to $3 billion. On Tuesday, FPIs invested Rs 5,627 crore.

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While most global gained on Tuesday, the rally was seen tapering off in some markets.

Analysts said even though the on the vaccine is a sentiment-booster, the process of actual implementation would take a while and concerns over legal challenges to the US elections persist.

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India continues to be the second-worst affected nation due to Covid-19. As of Tuesday, India had 8.5-million Covid-positive cases, according to the World Health Organization estimates.

The market breadth was slightly negative, with total advancing stocks at 1,227 and those declining at 1,484 on the BSE. Two-thirds of the Sensex components ended the session with gains.

Bajaj Finance was the best performing Sensex stock and gained 8.8 per cent.

IndusInd Bank rose more than 7.7 per cent.

Larsen & Toubro by 7 per cent.

Tech Mahindra and HCL Technologies were the worst-performing stocks and fell 5.7 and 5.4 per cent, respectively.

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First Published: Tue, November 10 2020. 20:29 IST
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