Sensex shining bright: Investor wealth zooms by over Rs 2.69 lakh cr in 3 sessions
Sensex gained over 1,100 points in last three sessions
In the last three trading sessions, the benchmark Sensex added over 1,100 points and regained the crucial 26,000-mark, as investors cheered the monsoon forecast that is estimated to be above-normal rainfall this year, besides pick-up in reforms with hopes of GST getting passed in the monsoon session of parliament.
The sharp rally in last three sessions also resulted in investor wealth surging by over Rs 2.69 lakh crore on expectations of further economic reforms in the third year of the Modi government.
Consequently, the market capitalisation of BSE-listed companies surged Rs 2,69,402 crore to Rs 98,11,322 crore.
On Thursday, the 30-share index ended the day at 26,366.68, a sharp rally of 485.51 points or 1.88 percent -- nearly a 7-month high.
The 50-share NSE Nifty ended at 8,069.65, a hefty gain of 134.75 points, or 1.70 per cent.
"Earnings growth will be the major driver of market going forward. Earnings growth has been subdued for the last 3 years and is now expected to revive in FY17. The Modi government has completed 2 years too, laying a strong structural foundation for future economic expansion. This will help the market to grow at a strong rate over the next 5 years," said Motilal Oswal, CMD, Motilal Oswal Financial Services.
Investors are hoping the strong show by the ruling BJP government in the Assam polls would help expedite various economic reforms by the NDA government in its third year.
"Improved fourth quarter earnings of index heavyweights provided the essential fire to the rally," said Vinod Nair, Head of Research, Geojit BNP Paribas Financial Services Ltd.
In fact, both FIIs and domestic institutional investors lapped up shares in last two trading sessions. According to provisional data on BSE, FIIs bought shares worth Rs 1,000 crore in two sessions, while DIIs, too, purchased shares to the tune of over Rs 1,000 crore in the recently-held rally.
Besides the upbeat monsoon forecast, domestic equities received a thumbs up from foreign brokerage Morgan Stanley, which upgraded Indian markets to 'overweight' from 'equal weight'. It also raised its 2016 Sensex target to 26,000 from 25,000 earlier.
Earlier this month, HSBC Global Research in a report had upgraded the Indian equity market to neutral from underweight and also raised its 2016 Sensex target to 26,000 from 25,000 earlier.
With agency inputs
Share market today: HDFC Bank was the top loser in the Sensex pack, shedding over 2 percent, followed by HDFC, IndusInd Bank, Kotak Bank, Axis Bank and ICICI Bank