Stock index adds 1,000 points in just 10 sessions to close at a record 38,024.37
Sustained buying support from foreign and domestic institutional investors, along with earnings-revival fuelled optimism, led the Sensex to one of its fastest 1,000 points rallies on Thursday as the equity benchmark soared above the 38,000-mark for the first time ever.
The 30-share Sensex touched an intraday high of 38,076.23 before closing at 38,024.37, up 136.81 points, or 0.36%. Gains were led by ICICI Bank, Axis Bank and State Bank of India along with NTPC, Power Grid Corp. and Vedanta.
Overall market breadth, while still negative, showed a marked improvement with 1,331 stocks advancing as against 1,351 declines. This was in contrast to some of the earlier sessions when the benchmarks rose amid significant broader market weakness. Investor optimism could be gauged from the fact that the Sensex had closed above the 37,000 mark only 9 trading sessions earlier on July 27. The index earlier took 13 sessions to move from 36,000 to 37,000. Incidentally, it took only five trading sessions in September 2007 for the Sensex to move from 16,000 to the 17,000 mark.
“Markets are gradually moving higher, without giving much importance to the global issues, be it escalation of trade war or currency fluctuation,” said Jayant Manglik, President, Religare Broking.
“It shows that participants are focusing mainly on earnings, which are largely in line with street expectations and even surpassed in some cases,” he said. Investors ought to “however, maintain extra caution in stock selection now as we have already seen decent surge,” he added.
Foreign portfolio investors have made net purchases of almost ₹2,000 crore in August, while flows from domestic institutional investors are already at record levels in 2018.