Sensex, Nifty end at record closing high despite rangebound trade; Midcap shines

Equity benchmarks ended rangebound session at record closing high on Tuesday as investors cheered monsoon rains that hit Kerala, north east simultaneously.

The 30-share BSE Sensex was up 50.12 points at 31,159.40 and the 50-share NSE Nifty rose 19.65 points to 9,624.55 despite negative market breadth.

Nirmal Jain of IIFL Group is bullish on India for the next ten years. “My optimism is based not only on a stable government moving firmly in the right direction but also on India’s unique position in the global economy at this point in time,” he said.

He feels India will continue to attract foreign investment in large quantum, supported by conducive policy framework, democracy with unbiased judiciary and potential for high returns.

Foreign institutional investors bought more than Rs 45,000 crore worth of shares in last one year.

The broader markets outperformed benchmarks, with the BSE Midcap index rising 0.8 percent and Smallcap 0.5 percent. About 1,452 shares declined against 1231 advancing shares on the exchange.

Nifty Pharma index snapped 10-day losing streak today, up more than 2.5 percent, led by Aurobindo Pharma that was top gainer with 13 percent upside after strong management outlook for FY18. Sun Pharma, Cipla, Lupin and Dr Reddy’s Labs gained 1-2 percent.

Natco Pharma rose nearly 6 percent after robust earnings for March quarter. Profit shot up 180 percent year-on-year, led by windfall gain from exclusivity of generic Tamiflu drug (used for treatment of influenza) in US market.

State-run power equipment maker BHEL lost nearly 9 percent as analysts retained bearish stance, citing concerns over revenue visibility and order inflow after fourth quarter earnings. With a very weak outlook on new thermal projects, BHEL is not the stock to play India capex revival story, according to Macquarie that maintained high conviction underperform on the stock.

Engineering and construction major L&T slipped over a percent on profit booking after hitting a 52-week high due to fourth quarter earnings. Macquarie recommended buying the stock to play India capex turnaround story.

Mahindra & Mahindra and Hindalco Industries gained nearly 1 percent following better-than-expected topline and bottomline in the quarter ended March 2017.

NTPC rallied 3 percent. After fourth quarter earnings, CLSA retained outperform rating on the stock, as the company is getting closer to robust renewable energy growth, which will expand return on equities.

Among others, ICICI Bank, Adani Ports, Infosys, SBI, ONGC, Hero Motocorp and Axis Bank gained 1-3 percent whereas ITC, HDFC and Bharti Airtel fell over a percent.

In broader space, Jubilant Foodworks trimmed its losses to 3 percent from 13 percent as CLSA retained its buy call on the stock despite sharp EPS cuts due to weak Q4 earnings.
On the global front, European markets were lower as investors shifted their attention to political events going on in Europe. France’s CAC, Germany’s DAX and Britain’s FTSE were down 0.1-0.6 percent at the time of writing this article. Asian indexes closed mixed after directionless session.