The Indian markets rallied ahead after the US Fed Reserve hinted of not going ahead with a rate hike
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MUMBAI: The Indian equity markets registered their biggest gain in nearly eight months amidst a strong rally in global stocks after the US Federal Reserve hinted that it may not go ahead with an interest rate hike in September as expected earlier.
The Sensex soared 516.53 points or 2.01 per cent to end the trading session at 26,231.19 while the Nifty closed the session at 7,948.95, gaining 157.10 points or 2.02 per cent. As the markets opened the day up with a huge gap, dealers said that traders were seen squaring-off their short positions in the futures and options segment. The rally also got further support from domestic institutional investors.
According to the provisional data released by the stock exchanges, DII purchased shares worth Rs 2,577.06 crore even as FPIs continued to trim exposure to Indian markets. They remained net sellers to the tune of Rs 3,347.35 crores.
“Overseas investors have rolled over their short positions to September series, which suggest that they are expecting the markets to fall in line with most other emerging markets. This is a sell on rise market and traders are expected to create fresh short positions at higher levels,” said Siddarth Bhamre, head of derivatives at Angel Broking.
The rally was broad based with even small and mid cap companies registering impressive gains. About 1,995 stocks traded on the BSE closed higher as compared to 694 stocks that declined. The BSE small cap index soared 2.56 per cent while the BSE mid cap index gained 2.49 per cent.
“India has been resilient among emerging markets and will continue to remain attractive to FPI’s due to positive domestic factors like possible rate cuts by the RBI and policy reforms, while further depreciation in rupee is a risk in the medium term,” said Vinod Nair, head of fundamental research, Geojit BNP Paribas Financial Services.
( Source : deccan chronicle )
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