Sensex hits 50,000-mark for first time ever: Top reasons behind the surge – Times of India

NEW DELHI: Equity indices scaled fresh record peaks on Thursday with the benchmark BSE sensex breaching the psychological 50,000-mark for the first time ever. The 30-share BSE index surged over 300 points to hit an all-time high of 50,126 in early trade; while the broader NSE Nifty moved nearly 100 points to 14,731.
Top gainers in the BSE pack included Bajaj Auto, Bajaj Finance, Bajaj Finserv, HCL Tech, Reliance Industries and Asian Paints with their shares rising as much as 1.43 per cent. On the NSE platfrom, all the sub-indices were trading in green with Nifty IT outperforming the index by jumping as much as 1 per cent.
Here are the top reasons behind the rally:
* Upbeat global cues: The domestic indices rose on optimism over the new US President Joe Biden’s administration will mean more support for the struggling US economy, setting off a recovery that’s crucial for the export-driven Asian region.
Market players here said that with the US markets creating fresh records, sensex and Nifty too could witness smart gains.
Wall Street greeted the new US President by climbing even higher on Wednesday, closing at records amid promises of big economic stimulus and relief that the inauguration was uneventful.
All three major indices (Dow Jones, Nasdaq, S&P 500) ended at all-time highs after Biden was inaugurated as the 46th president of the United States in a peaceful ceremony.
“In general, this is a market that’s growing optimistic that increased fiscal spending will boost the economy and lead to earnings growth,” Art Hogan, chief market strategist at National Securities, told news agency AFP.
* Strong corporate earnings: Analysts said that strong corporate earnings by Tata Consultancy Services (TCS), Infosys, Wipro, HCL Technologies and HDFC Bank are also fuelling the bullishness on Dalal Street.
* Budget 2021 in focus: Investor sentiments remained positive amid hopes of bold economic reforms in the upcoming Union Budget 2021-22. Finance minister Nirmala Sitharaman will present this year’s Budget on February 1.
“Also moving the markets were expectations of positive announcements from India’s upcoming budget and encouraging corporate earnings, Ajit Mishra, vice president, research at Religare Broking told Reuters.
* Foreign fund inflows: Wednesday’s rally was backed by a Rs 2,289-crore net foreign fund inflow, although domestic funds were net sellers at Rs 865 crore, data from the BSE showed. And on Tuesday, foreign institutional investors (FIIs) were net buyers in the capital market as they purchased shares worth Rs 257.55 crore.
* IPO push: The Rs 4,633-crore maiden public offering for Indian Railway Finance Corp (IRFC), which closed on Wednesday, was subscribed 3.5 times. Through this offer, the government aims to mobilise about Rs 1,544 crore by diluting part of its stake in the NBFC, while the company is raising Rs 3,089 crore as fresh capital.
Wednesday also witnessed the launch of the IPO for Indigo Paints, which was subscribed nearly two times.
(With inputs from agencies)