Sensex closes above 30,000 for first time

Mumbai: The equity markets soared to a record high with the 30-share BSE Sensex closing above the 30K level mark for the first time as better than expected earnings surprises from select index heavyweights along with buoyant global markets triggered fresh buying in frontline stocks. The Sensex scaled above its resistance of 30K-level mark after a gap of over two years to end the trading session at 30,133.35, up 190.11 points or 0.63 per cent. The broader 50-share Nifty also closed at a record high of 9,351.85, gaining 45.25 points or 0.49 per cent.  

“The Sensex touched the coveted levels of 30,000 buoyed by the anticipation of strong economic and earnings growth going ahead. One needs to understand that the Indian economy is on a strong footing with relatively strong macroeconomic fundamentals, lower inflation and interest rate regime, the possibility of a major reform such as GST and a favourable demography supporting sustainable growth. While there is a delay in private capex cycle, we must make a note that markets always discount future earnings and growth potential,” said Pankaj Pandey, head of research, ICICI Direct.

With enabling fundamental factors such as stabilised commodity prices, upbeat consumption and most importantly, a favourable low base, Mr Pandey said the corporate earnings could witness a strong double-digit growth recovery in FY18, which would drive the market momentum. While maintaining a positive outlook on the markets, Harsha Upadhyaya, CIO, equity at Kotak Mutual Fund said mutual fund investors should maintain a staggered and regular investment approach since the markets are trading at an all-time high and further upside would depend on earnings growth recovery and liquidity flows.  

However, the broader markets did not participate in the rally as the small and mid cap stocks witnessed heavy profit booking after registering steep rally over the last few weeks. Out of 3,045 stocks traded on the BSE, 1,989 stocks closed in the red as compared to just 921 stocks that advanced. According to the provisional data released by the stock exchanges, FPIs offloaded shares worth Rs 492.52 crore, which suggests that the rally was primarily driven by domestic investors. The domestic institutional investors bought shares worth Rs 1,011.38 crore.

“We are going through a period of political stability, which is very favourable to bring reforms and new investments in the country. Overall, the markets are likely to remain strong with GST implementation just a couple of months away and expectation of normal monsoon this year,” said Vaibhav Agrawal, head of research, Angel Broking.