Domestic investors threw caution to the wind on September 20 and bought whatever they could find their hands on, taking the benchmark indices higher. This was despite uncertainty over the quantum of US Fed policy rate hike.
Buying was also seen in the US market overnight, followed by the Asian markets. This also enthused the market participants. Steady foreign investment flow also encouraged market sentiments.
The BSE flagship Sensex was up 700 points or 1.27 percent to 59,893. Broader NSE Nifty rose 204 points or 1.16 percent to 17,826. Investor wealth, reflected by the market cap of all BSE-listed companies rose Rs 3.07 lakh crore to Rs 283.67 lakh crore from Rs 280.60 lakh crore.
Barring Grasim that traded in the red, all stocks in the Nifty 50 traded with gains. Tata Motors was the biggest gainer, up 3.71 percent, followed by Hindalco Industries, IndusInd Bank, Bajaj Finserv and Eicher Motors.
All sectoral indices were in the green and so were the broader market indices. Nifty Metal was the biggest gainer followed by indices representing banks and financials.
US markets
Wall Street’s main indices ended a seesaw session higher on September 19, setting the tone for markets elsewhere. The Dow Jones Industrial Average rose 197.26 points, or 0.64 percent, to 31,019.68, the S&P 500 gained 26.56 points, or 0.69 percent, to 3,899.89 and the Nasdaq Composite added 86.62 points, or 0.76 percent, to 11,535.02.
Asian markets
All Asian markets traded with gains as well. Japan’s Nikkei was up 0.4 percent; Singapore’s Strait Times also rose by about the same margin. Hang Seng, Taiwan Weighted, Kospi and Shanghai composite also traded with gains up to 1.5 percent.
FII data
Foreign investors continued their bullishness on Indian stocks for another day. Foreign institutional investors (FIIs) net bought shares worth Rs 312.31 crore on September 19 even when domestic institutional investors (DIIs) net sold shares worth Rs 94.68 crore, as per provisional data available on the NSE.
Tech view
Most technical analysts see positive momentum to remain there at least in the medium term. Going ahead, ICICI Securities expects Nifty volatility to remain high ahead of Fed meet outcome wherein the index would consolidate and form a higher base to pave the way towards January 2022 high of 18,300 by October.
“In the process, strong support is placed at 17,300, which we do not expect to get breached. The index is undergoing healthy consolidation, which will help to cool off overbought conditions. Empirically, secondary correction is an integral part of the bull market that paves the way for the next leg of the up move. Thus, ongoing breather should not be construed as negative,” it said.
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