By Bharath Rajeswaran
BENGALURU (Reuters) -India’s benchmark indexes, the NSE Nifty 50 and S&P BSE Sensex, recovered from a sluggish start to reach record highs on Thursday, driven by strong performances in financial and information technology stocks.
Both the indexes rose about 0.5% each to hit all-time high levels, as of 12:49 p.m. IST.
“The party will continue in Indian markets as long as liquidity continues to be supportive. Investors are resorting to buying every dip, to benefit from the upward momentum,” said Samrat Dasgupta, chief executive at Esquire Capital Investment Advisors.
Domestic institutional investors (DIIs) have been net buyers of Indian shares in 17 of the 19 sessions in August, adding about 486.9 billion rupees (about $6 billion).
“The benchmarks have further scope to gain … if the U.S. inflation reading on Friday remains soft, while financials can also join the party given their attractive valuations,” Dasgupta added.
Eight of the 13 major sectors logged gains. The two heaviest sectors in benchmarks Nifty, financial services and IT rose about 0.6% each.
The broader, more domestically focussed small- and mid-caps fell about 0.5% each, underperforming benchmarks.
“Investors should exercise caution in small- and mid-caps, where valuations are out-of-sync with fundamentals,” Dasgupta added.
Asian markets and U.S. equity futures fell, dragged down by technology stocks after chipmaker Nvidia’s better-than-expected results failed to impress some investors. [MKTS/GLOB]
Paytm gained 1% after the digital payments company got government approval to invest in its payments arm.
Reliance Industries, the second-heaviest stock on the Nifty, rose 0.7% ahead of an annual general meeting. The conglomerate and Disney won approval for the $8.5 billion merger of their Indian media assets.
Power Finance Corp and REC rose about 2% each after UBS started coverage on the power financiers with “buy” ratings, citing strong growth outlooks.
($1 = 83.8800 Indian rupees)
(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Sonia Cheema, Savio D’Souza and Nivedita Bhattacharjee)
