Business

Bull in driver’s seat! Sensex hits 38,000 for first time ever

The broader Nifty, too, ended at a fresh lifetime high 

Mumbai: The Sensex journeyed from 37,000 to 38,000 in just 10 trading sessions. It had hit the 37,000 mark on July 26 for the first time and since then it was a one-way rally for the index which took it to 38,000 levels in intraday trade on August 9.

While the broader Nifty too ended at a fresh lifetime high on unabated buying by participants.

The broader Nifty rose 20.70 points, or 0.18%, to close at 11,470.70 — surpassing its previous high of 11,450 reached on Wednesday.

The Indian market climbed a wall of worries with respect to trade wars brewing between the two biggest economies US and China as well as falling rupee-dollar and volatile crude oil prices. But strong earnings lend the much-needed support to markets.

Most stocks that bounced back were mostly beaten down in 2018. Nearly half of the stocks in the BSE 500 index outperformed the Sensex in the same period. The Sensex is up 2.7% in the last 10 days while as many as 240 stocks in the BSE 500 index returned over 3%. Sixty out of 240 stocks offered double-digit returns (10-60 percent). Fifteen of 60 stocks rose 20-50% in the same period. These include: Kwality, 8K Miles Software Services, Reliance Naval and Engineering, Reliance Communications, Vinati Organics, Welspun India, Inox Leisure and Bharat Electronics.

Strong corporate results have been lending buying support to markets at lower levels. Of the 1,010 companies that have announced their April to June earnings, sales rose around 17% on a year-on-year basis. Net profit has been around 14%, said a Stewart Mackertich Research report.

Stellar performance has been recorded by private banks and non-banking financial companies (NBFCs). Consumer-related companies like Hindustan Unilever and Dabur registered strong volume growth, clearly indicating underlying strength in the India consumption story.

Smallcaps and midcaps shine 

  • Small and midcap stocks also contributed to the rally. Over 180 constituents of the BSE Smallcap index returned 10-50% in a matter of just 10 sessions.
  • Eleven of the 183 stocks, which have posted double-digit returns, delivered over 40% return. These include: Electrosteel Steels (up 55%), Indosolar (up 54%), Kwality (up 54%) and 8K Miles Software Services (up 50%).
  • In the midcap space, 12 stocks rose 10-33% in the same period. These include: RCom, Aditya Birla Fashion, Bharat Electronics, Adani & others.

(With inputs from Agencies)

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