Indian stock markets finished the week on a strong note, led by a surge in financial stocks. The Sensex surged 975 points today to finish at 50,540 while the broader Nifty added 1.81% to close at 15,175.30. For the week, both the indexes rose more than 3%.
The Nifty Bank Index jumped nearly 4%, helped by a 4.3% rise in SBI after the country’s largest lender by assets reported a record quarterly profit. HDFC Bank, ICICI Bank and Axis Bank jumped between 3.5% and 4.5%. Also lifting the sentiment, daily cases of the novel coronavirus in India stayed below the 300,000-mark for the fifth straight day.
The Indian rupee also gained today, tracking the uptick in domestic markets. The rupee strengthened by 29 paise to end at 72.83 against the US dollar on Friday.
Meanwhile, the Reserve Bank of India’s board today approved a significantly higher than expected surplus transfer to the government. The RBI announced a surplus transfer of ₹99,122 crore for the 9-month period from July 2020 to March 2021.
“We think today’s dividend announcement will relieve some of the fiscal pressure on the government, providing it with more room to spend in the current fiscal year. This could be particularly helpful in alleviating the impact of the second COVID-19 wave,” Barclays said in a note.
Globally, stocks were mostly higher today, taking their lead from a stronger Wall Street as US data tempered inflation fears. The broader markets underperformed but ended with decent gains.
Here is what analysts said on today’s market performance:
Deepak Jasani, Head of Retail Research, HDFC Securities
“Hopes of a fresh stimulus and the transfer of surplus of Rs.99122 crore by the central bank to the GOI, boosted sentiments on the street. Also encouraging PMI data from across the globe and falling Covid cases locally helped lift trader spirits. Nifty closed the week higher by 3.4%, its best weekly gain since February. Now the Nifty is on the way to reach/breach the earlier high. 14928-14984 is the new support band for the Nifty while 15336-15432 is the resistance.”
Ajit Mishra, VP – Research, Religare Broking Ltd
“We feel global cues will continue to dictate the trend in near future. The recent buoyancy in the banking and financial is certainly encouraging and participation of other sectors on rotational basis would further fuel the recovery. We suggest continuing with positive yet cautious approach and reiterate our immediate target of 15,300 for Nifty.”
Manish Hathiramani, Proprietary Index Trader and Technical Analyst, Deen Dayal Investments
“We have successfully closed above the 15150 levels. We should be heading higher to 15300 as the next pit stop. The support continues to be at 14700 and this will get upgraded on Monday. As long as this is holding, we are in bullish terrain and can continue buying the dips for higher targets.”
Vinod Nair, Head of Research at Geojit Financial Services.
“Domestic equities witnessed strong rebound after being lacklustre for two days following the weak global market. The easing covid concerns, appreciation in INR and recent positive global data helped the market. The volatility index is reducing gauging outperformance to continue.”
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