Mumbai: Shrugging off rise in retail inflation and fall in industrial production, other national as well as global positive factors send both the key indices, the S&P BSE benchmark Sensex and CNX Nifty, up by three percent to end at three-week high during the truncated week.
The BSE and NSE were closed on Friday, August 15, for 'Independence Day'.
The market resumed on a firm note after SEBI cleared REIT norms. Industry and experts welcomed REIT and Investment Trust guidelines and said it would help attract foreign as well as domestic investments to the tune of USD 15-20 billion (over Rs one lakh crore) through such trusts.
Encouraging Q1 earnings from some corporates as well as sustained FII buying also supported the market sentiment.
The macro concerns somewhat felt moderated for market players as the government data of key Wholesale Price Index dipped to five month low to 5.19 percent in July, though higher retail inflation (CPI) figures and sluggish Industrial Production growth rate (IIP) remain causes of concern.
Retail inflation, measured on consumer price index (CPI), inched up to 7.96 percent in July as compared to 7.46 percent in June, while the growth rate of the Index of Industrial Production (IIP) slowed to 3.4 percent in June as against 5.0 percent (revised) in May, showing signs of sluggishness in the economy.
The BSE S&P Sensex resumed higher and traded between 26,135 and 25,437.05 before ending to three-week high of 26,103.23, showing a gain of 774.09 points or 3.06 percent.
In last two weeks, it had fallen by 797.61 points or 3.05 percent.
The NSE 50-share Nifty also spurted by 223.15 points, or 2.95 percent, to conclude at three-week high of 7,791.70.
On the global front, reduced geopolitical concerns also fuelled buying activity.
Expecting the situation in Ukraine and Middle East to stabilise on reports that the Russian war planes have finished military exercises near Ukraine's border and an agreement between Israel and Hamas on Wednesday to decide to extend the temporary truce in Gaza for five more days, moments before the existing ceasefire was to expire, also buoyed the sentiment.
A fall in global crude oil prices following easing of economical global worries also maintained the market outlook positive.
Jignesh Chaudhary, Head of Research, Veracity Broking Services said, "The Indian equity markets were positive in the entire trading week in spite of poor economic data - the industrial production decreased and inflation increased.
"FII's have been the key drivers of the Indian equity market, they bought stocks worth Rs 7.18 billion (USD 117.6 million) on Wednesday which also helped the markets to grow."
"On Friday, all investors were eager to listen to the newly elected Prime Minister on the Independence Day to check the reforms which he will be announcing and also would show the track which government would be following. It was clear from his speech that the government is business-friendly," he added.
Overall, 22 scrips of the 30-share Sensex closed higher while others ended lower.
Major gainers were Tata Motors (11.92 percent), HDFC (9.57 percent), M&M (7.70 percent), SSLT (7.37 percent), Sun Pharma (7.21 percent), Gail India (4.45 percent), ONGC (4.01 percent), HDFC Bank (3.70 percent), Infosys (3.55 percent), ICICI Bank (2.88 percent), L&T (2.69 percent), NTPC (2.68 percent), Cipla (2.63 percent), ITC (2.38 percent), RIL (2.19 percent), Maruti Suzuki (2.05 percent), Axis Bank (1.74 percent) and HUL (1.72 percent).
However, BHEL dropped by 4.08 percent, followed by Hero MotoCorp (3.06 percent), Hindalco (3.02 percent), Bharti Airtel (2.18 percent), SBI (2.21 percent) and Dr Reddy's Lab (1.01 percent).
Among the S&P BSE sectoral indices, Auto rose by 5.17 percent, HC (3.74 percent), Oil & Gas (3.17 percent), Metal (2.23 percent), FMCG (2.16 percent), Bankex (2.06 percent) and CD (1.55 percent), while Realty fell by 1.64 percent.
The total turnover at BSE and NSE dropped to Rs 10,052.27 crore and Rs 57,665.96 crore, respectively due to truncated week from last weekend's level of Rs 13,623.67 core and Rs 74,367.90 crore, respectively.
