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Nifty hits record high, Sensex stays strong on global markets support

LiveMint logoLiveMint 18-09-2017 Nasrin Sultana

Mumbai: Supported by strong global cues, Indian markets have started the week on a strong note. The Nifty touched a record high at 10,167.15 points in early trade, while the Sensex was around 200 points away from its life high. At 10:04am, the 30-share index was up 197.45 points or 0.61% at 32,470.06, and the Nifty was up 76 points or 0.75% at 10,161.40.

Asian shares were also on an uptrend with South Korea’s benchmark Kospi and Hong Kong’s Hang Seng index up nearly 1%.

Siddhartha Khemka, head, equity research (wealth) at Centrum Broking Ltd, said the rally in global markets is supporting domestic markets here. “Also, investors are positive on Indian markets due to various reasons like strong domestic liquidity, expectations of earnings recovery by FY18 end, slew of government reforms and benefits of good monsoon.”

Foreign institutional investors (FIIs), however, have been selling Indian equities in August and September. So far in this month, FIIs have sold Indian equities worth Rs1,09,427.2 crore after selling Rs38,157.58 crore in August. In contrast, domestic institutional investors (DIIs) have bought Rs30,098.86 crore in September so far after the purchase of Indian shares worth Rs65,812.92 crore last month.

The outcome of the two-day meeting of the US Federal Reserve on Wednesday may have an impact on foreign money. The central bank is unlikely to raise interest rates this time. It has already hiked rates twice this year. The most central theme of Fed chief Janet Yellen’s speech will be plans of restoring the US central bank’s $4.5 trillion portfolio. According to Reuters, the US Fed is widely expected to announce plans to begin unwinding its $4.2 trillion portfolio of treasuries and mortgage-backed securities in its latest step toward monetary policy normalisation, nearly a decade after the global financial crisis.

Jimeet Modi, chief executive officer, SAMCO Securities, said India has enough domestic money to absorb the money liquidity outflow. However, he added, “If the Fed is hawkish then we could see some pressure on foreign liquidity in India.”

Indian markets have been outperforming peers this year. So far in 2017, the Sensex and Nifty have gained 21.21% and 23.21%, respectively, while MSCI India was up 22.05%, MSCI EM jumped 20.49% and MSCI World surged 6.98% in rupee terms.

There were two new entrants in the stock exchanges on Monday. Consumer electronics manufacturer Dixon Technologies India Ltd debuted at Rs2,725 per share, offering a premium of 60% from its issue price of Rs1,766. The initial public offering (IPO) of Dixon Technologies, which was open from 6-8 September with a price band of Rs1,760-1,766 per share, was oversubscribed 117.83 times.

Bharat Road Network made a tepid debut on the BSE. It got listed at Rs204.90, a discount of 0.05% over its issue price of Rs205 per share. Bharat Road Network’s IPO, with a price band of Rs195-205, was oversubscribed 1.81 times during the share sale from 6-8 September.

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