In the holiday season, trading volumes are low around the world however the Santa Claus rally took into force for Sensex and Nifty in India. Next week when the New Year begins, there will be more trading volumes as cash allocations are then decided.
Sensex created a Merry Christmas feeling with a cake cutting ceremony with a Bull on top showing the bullish market it is in now.
The main reason for the big pump is a huge cash inflow from domestic institutional investors, who pumped in ₹544 crore It would have pumped higher, if it was not for foreign portfolio investors who cashed out a total of ₹44.07 crore in return for end of year gifts and holidays.
Among companies on the rise were, Reliance Industries, Bharti Airtel, Sun Pharma, Yes Bank and Tata Steel. Public sector banks were on the decline in stocks however.
The highlight was Reliance Communications starting to trade, after the companys press conference. It rose to 40% right after this public event. This was a major surprise, given the debt issues it carries.
With other markets on holiday, Systematic Investment Plans are helping Sensex and Nifty achieve commendable levels.
Hemang Jani, head of advisory of Sharekhan said, “The rally could stretch well beyond January as third quarter results expectations are good and the global set up is supportive.”
A report by the Centre for Economics and Business Research in London, which sees India becoming the worlds fifth biggest economy in dollar terms. By 2027, India is predicted to advance to third place.
These are overall good signs for the Indian economy and stock market. 2018 is seen to have good potential progress in terms of consumption, banks and NBBFCs and sectors like roads, railways and defence. Government capital expenditure is bound to increase for in such sectors.