Mumbai: The Sensex and the Nifty soared to a three-month high, heralding the official news of a good monsoon this year and signs of a turnaround in industrial production which rose 2 per cent in February.
The Sensex rose 481.16 points to close at 25,145.59 — the highest level since January 2016, increasing investor wealth by over Rs 1- lakh crore. The Nifty gained a robust 141.50 points to close at 7,850.45.
A good monsoon could see agricultural growth, adding 4-5 per cent to GDP giving a further boost to the economy. The IMF too has reiterated the Indian economy being the only bright spot. This will mean that more funds will flow into India as there are few other growing economies into which these funds can flow.
Agriculture-related stocks such as fertilisers to farm equipment had a field day on Wednesday gaining upto to seven per cent in somes stock. Jain Irrigation Systems gained 1.62 per cent while two wheeler stocks like Hero MotoCorp an FMCG player Hindustan Lever were up 3.33 per cent and 2.85 per cent respectively.
According to Jimeet Modi, the CEO of SAMCO Securities, the Nifty soaring even higher with “short term higher tops, higher bottoms spree in the Nifty 50 that will take the market to higher levels.” However at 8,000 levels, he cautions, the Nifty would shall face stiff resistance and major profit booking is expected.
Ambareesh Baliga, senior market analyst, says “this is the beginning of a long term bull market.” The markets had been moving up on strong fundamentals and last week got support from oil.
The only thing missing was the monsoon. Now that it has been confirmed that there would be an above normal monsoon, it will be good for the markets for the next couple of weeks.
“We could see the Sensex in the range of 26,000-26,500. With funds flowing in into productive sectors like infrastructure and the earnings season not expected to be a dampner the markets will continue to go higher.”
Anand James, chief market strategist, Geojit BNP Paribas Financial Services Ltd, “the Nifty could not ask for a better set up to rise to almost the highest this year,” with the monsoon cheer getting further boost with Asian equity markets in the green, firm rupee, rising oil and bullish economic data. To further sweeten the day’s sentiments, IMF retained India’s GDP forecast.
