Home Market Sensex rises 323 points on strong Asian cues, but players expect trend...

Sensex rises 323 points on strong Asian cues, but players expect trend to stay weak


MUMBAI: Stock indices ended up 1 per cent on Friday, with the Nifty rising the most in a month on strong cues from Asian markets. With Friday’s gains, indices managed to eke out gains for the week. Both indices closed at a oneweek high.

The Sensex ended up 322.65 points or 0.95 per cent at 34,142.15 and the Nifty ended up 108.35 points or 1.04 per cent at 10,491.05. The volatility index India VIX declined for the third day, ending down 4.2 per cent at 14.20.

The broader market outperformed, with the BSE MidCap index rising 1.47 per cent to 16,562.03 and the BSE SmallCap index gaining 1.54 per cent to end at 17,996.22.

Most Asian indices gained on Friday after bond yields in the US fell from their multi-year highs, which helped ease concerns over higher rates and inflation.

Despite Friday’s gains, market participants believe that the trend in the near-term is likely to remain weak. Indices are still down for the month, with the Sensex down 5.1 per cent and the Nifty down 4.9 per cent so far in February.

The slide this month has come on the back of concerns over rising bond yields in the US, re-introduction of long term capital gains tax on equity in India and the surfacing of the Rs 11,400 crore fraud at the Punjab National Bank.

“We are still in a corrective phase,” said Raamdeo Agrawal, joint managing director at Motilal Oswal Financial Services.

Agrawal added that he doesn’t see a significant downside from current levels as domestic flows remain strong.

“Some of the larger investors, in fact, have used this opportunity to buy more,” said Agrawal.

Domestic institutional investors bought shares worth ?1,514.03 crore on Friday, while foreign portfolio investors sold shares worth ?486.32 crore.

So far in February, DIIs have bought shares worth ?13,760 crore and FPIs have sold shares worth ?10,120.7 crore.

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