Sensex, Nifty close marginally higher amid thin trade

Mumbai: The post-Budget climb went on for the third day as the Sensex managed to close at 28,241 with a minuscule gain after a monthly survey suggested that Reserve Bank has much headroom to stay accommodative in its policy meet next week.

Aided by banking and healthcare stocks, the 30-share Sensex moved sideways for much of the session before settling at 28,240.52, up 13.91 points, or 0.05%. The previous two sessions have seen a rally of 570.65 points after the Union Budget was greeted positively by investors. The 50-share NSE Nifty settled at 8,740.95, up 6.70 points, or 0.08%.

On a weekly basis, the Sensex rallied 358.06 points, or 1.28%, and the Nifty 99.70 points, or 1.15%. Services sector contracted for the third consecutive month in January as the Nikkei India Services PMI stood at 48.7, as against 46.8 in December 2016. The PMI survey showed that input cost inflation slowed since December whereas average selling prices shrank again, which may prompt the Reserve Bank to go in for an “accommodative” monetary policy. Rupee was a sentiment booster too as its good run against the dollar continued at 67.30 (intra-day).

Asian markets were mixed at the close and European shares were higher at the start. The investors are looking forward to the release of US payroll data. Shares of banks such as SBI, Axis Bank and HDFC Bank were at the centre of brisk buying activity, which rose by up to 1.72% ahead of the RBI policy meet on 8 February.

Cipla, Coal India, Dr Reddy’s, TCS, Sun Pharma, HUL, GAIL and Lupin advanced by up to 4.18%. Sun TV Network soared 23.92% after a special court yesterday acquitted former telecom minister Dayanidhi Maran, his brother and promoter Kalanithi Maran and others in the Aircel-Maxis deal case.

Glenmark Pharma jumped 4.21% after an over two-fold jump in consolidated net profit for the December quarter. In the meantime, shares of BSE made a stellar debut at the National Stock Exchange (NSE) today by surging 32.65% to Rs1,069.20 against the issue price of Rs806. The healthcare scaled the most (1.61%), followed by PSU, realty, capital goods, IT and bank.

The broader markets too continued to trend firm as retail investors boosted their bets, with the BSE small-cap index rising 1.08% and mid-cap 0.61%. Japan’s Nikkei ended higher while Hong Kong and Shanghai finished in the negative zone. Europe ruled high in early deals. Foreign investors bought shares worth a net Rs108.59 crore while domestic ones net bought shares worth Rs1,133.74 crore on Thursday, as per provisional data.

“The market is consolidating after the strong rally on the budget day,” said Vinod Nair, head of research at Geojit BNP Paribas Securities. “Going forward, the focus will be on the RBI meet next week,” he added.