In just four trading sessions, the BSE Sensex surged by another 1,000 points breaching 19,000 on Monday, while NSE’s Nifty jumped close to 350 points during the same period.
Brokers said the rally was driven mainly by liquidity flowing from overseas funds.
The Sensex gained 639 points or 3.47 per cent today closing at 19,058.67.
The S&P CNX Nifty went up by 4.46 per cent, closing at 5,670.40.
The FIIs were net buyers to the tune of 2,868.59 crore, whereas domestic institutional investors were net sellers to the tune of 281.11 crore.
“This rally is mainly liquidity-driven and foreign investors are willing to pay a premium for Indian assets. There is also a more fundamental reason that corporates are doing well, as almost all companies which have come out with their results are reporting an average 40-50 per cent rise in their bottomlines,” said Mr C.J. George, Geojit Financial Services Ltd.
Metals shine
The top sectoral gainer today was BSE-Metal, which rose 9.16 per cent, followed by BSE-PSU, which was up 5.57 per cent and Oil & Gas, which rose 4.51 per cent.
“Many fund houses are reducing their exposure in developed countries and increasing it in emerging markets and as a result we are witnessing huge inflows from overseas and these are taking the market to higher levels,” said Ms Anita Gandhi, Head of Institutional Business, Arihant Capital Markets Ltd.
“There seems to be only five to six stocks driving the market as of now, but there might be a major re-rating, all across the grade,” said Mr Sanjay Sinha, Chief Investment Officer, SBI Funds Management Private Ltd.
According to analysts, metal shares were in the limelight as companies have increased prices, passing on the rise input costs to their customers.
“It seems that there are a handful of people driving the market and creating such a euphoria,” said Mr R. Balagopal, Senior Vice-President, Fedex Securities Ltd.
Major gainers
The major gainers today were Reliance Energy, up 12.90 per cent, ONGC (9.11 per cent), Tata Steel (7.46 per cent), Maruti Udyog (5.79 per cent), whereas Hindustan Unilever dipped by 0.99 per cent and Infosys Technologies Ltd fell 0.09 per cent.
