Friday fireworks light up D-street in flamboyant style
Dalal Street witnessed a blockbuster rally on Friday on the back of European debt deal that sparked euphoria across all global financial markets.
Pivotals caught up with the global rally after a holiday on Thursday on account of Diwali, after EU members agreed to raise the Euro zone bailout fund to about Euro 1 trillion on the previous day.
That apart, data showing the US economy grew in the third quarter at its fastest pace in a year stoked appetite for riskier assets with domestic bourses being no exception.
This was the first trading session on domestic bourses after Diwali, a festival of wealth & prosperity and key benchmark indices surged to hit 11-1/2 week closing highs. Besides, the market gained for the fourth straight day, with Sensex and Nifty gaining around 3 points each for the day as market breadth being strong. Buying was witnessed across the board with all the 13 sectoral indices on BSE clocking gains.
So much so, it was a strong rally in the domestic stock market— which had an extra day to digest EU's new plan -- the biggest in the last two months, which added an estimated Rs 1.5 lakh crore to the investors' wealth this day. In the process, the total investor wealth, measured in terms of cumulative market value of all listed stocks, soared to Rs 62,64,794 crore, from Rs 61,26,291 crore before the trading commenced this morning.
Kotak Securities’ Head Shrikant Chouhan said: “The market remained in a rising trend throughout the week and on the day of expiry (on Tuesday) it entered into medium tern up trend above 5177. On the last day of the week due to strong global cues it opened up with a huge gap of approximately 200 points and the gap remained unfilled till the session expired, which is a bullish indication.”
Angel Broking’s Siddharth Bhamre said the short covering would take the market to over 5,400 levels, probably to 5,500. “We have upgraded our target of Nifty from 5,400 to atleast 5,500. We are holding on to our long positions, we are not booking profits,” he adds.
Surge in metal prices
Metal stocks led the rally on surge in global metal prices. Hindalco Industries jumped more than 10 per cent. Interest rate sensitive realty and banking stocks rose after RBI hinted that a pause in interest rate hikes is likely at its December meeting. Among index heavyweights Reliance Industries jumped nearly 3 per cent, L&T surged close to 5 per cent and ICICI Bank galloped 7 per cent. ITC, Bajaj Auto and M&M hit record highs.
The popular Sensex at BSE was up 515.97 points or 2.98 per cent to 17,804.80, its highest closing level since August 3, 2011. The index jumped 619.30 points at the day's high and rose 383.03 points at the day’s low.
The 50-unit S&P CNX Nifty was up 158.90 points or 3.05 per cent to 5360.70, its highest closing level since August 3, 2011. The Nifty hit a high of 5,399.70 in intraday trade.
The market breadth, indicating the overall health of the market, was strong with as many as 1738 shares on BSE rose and 1,142 fell while a total of 88 shares were unchanged. BSE for the day clocked a turnover of Rs 2502 crore.
Meanwhile during the day, European markets reversed initial gains with key benchmark indices in UK, and France were down by between 0.17 to 0.38 per cent and Germany's DAX rose 0.08 per cent. Asian stocks advanced on Friday as a long-awaited plan to resolve the European debt crisis encouraged investors to put money back in markets driving up prices of risky assets such as the euro and commodities. Key benchmark indices in China, Hong Kong, Indonesia, Japan, Singapore, South Korea and Taiwan rose by between 0.39 to 2.04 per cent.
Trading in US index futures indicated that the Dow could fall 64 points at the opening bell on Friday.
