Mumbai: Bulls' rampage on Dalal Street continued for another day as market hit historic highs for the second straight session. Ending the day above 7,600 for the first time in history, the Nifty settled at 7654.60, up 71.20 points or 0.94 percent while the Sensex was up 183.75 points or 0.7 percent at 25580.21.
Heavyweights rallied while midcaps maintained their outperformance. President Pranab Mukherjee laid down roadmap of the new government and outlined its reform agenda, which boosted investors' sentiment. In his address to a joint sitting of the Parliament, the President listed priorities of the NDA government which include focusing on rural development, attracting foreign investments and taking India back to the path of economic growth.
He also outlined the tax reforms agenda of the Modi government, highlighting need for a non-adversarial tax environment. Optimistic analysts are betting big on the market. Samir Arora, Founder & Fund Manager, Helios Capital says this is what we call a bull market and not what we saw in February-March.
However, he warns that pace of rally is a bit unnerving and maybe the market is doing everything in a compressed period of time. According to Arora, some stocks have gone up too much on hype in every sector and that is how India is, it is a volatile market. He advises to buy when some stocks may correct post Budget.
Meanwhile, global investors are also euphoric as world shares were within touching distance of an all-time high, spurred on by the combination of record low global interest rates and the improving health of major economies. European markets opened on the front foot again, looking for their 10th straight week of gains after last week's bumper set of easing measures from the European Central Bank. Asian stocks earlier touched their highest levels in nearly three years while Wall Street notched another record close on Friday following bright US jobs data.
Stocks in action
Most stocks were riding on a Modi wave hoping for better reforms and special impetus by the government. Coal India ended with a gain of 6 percent as Modi government will pursue coal sector reforms to attract investment. Rail stocks like Kernex Micro, Kalindee Rail and Texmaco rallied as investment in railways will be increased while modernisation and revamp of railways are top agenda of the government. Defence stocks like BEL, BEML and Pipvav Defence were on buyers' radar as the government is hoping to liberalise FDI in defence production and to carry out reforms in defence procurement. It will also set up national maritime authority.
Real estate Stocks Prestige and Sobha Developers were up on hopes that the government is aiming for proper housing to all citizens by 2022 and will build 100 new cities. Bajaj Auto, L&T, GAIL and Tata Power were major gainers in the Sensex. However some heavyweight stocks like ONGC, SBI, HUL, M&M and Infosys remained under selling pressure throughout the day.
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