The Nifty50, too, breached the 11,700 level for the first time since September 2018 to hit an intra-day high of 11,716.
A
sharp rally in three private sector banks – HDFC Bank, ICICI Bank
and Axis Bank – that have gained over 10 per cent each from their
August 29, 2018 level helped the benchmark index S&P BSE Sensex
breeze past the 39,000 mark and hit a new high on Monday. The
benchmark index surpassed its previous high of 38,990 recorded on
August 29, 2018 in intra-day deals.
The
Nifty50, too, breached the 11,700 level for the first time since
September 2018 to hit an intra-day high of 11,716.
Besides
these three private sector banks, Reliance
Industries (RIL), Infosys, Bajaj Auto, Asian Paints, HCL
Technologies, Larsen & Toubro (L&T) and State Bank of India
(SBI) have gained in the range of 4 to 9 per cent from their August
2018 levels and helped the 30-share index record a new high on
Monday.
“There
is more steam left and I feel the S&P BSE Sensex can hit 40,000
levels before the election results are known in May. The optimism
stems from the strong foreign flows that we are getting. India now
seems to be an attractive investment destination for foreigners amid
slowing global growth,” says G Chokkalingam, founder and managing
director, Equinomics Research.
Among
sectors, most analysts remain bullish on the banking space despite
the recent run-up and suggest investors stay put with large private
sector banks and good quality public sector plays.
A
pick up in industrial activity that will spur corporate loans,
aggressive recognition of bad assets and improving recovery that will
help boost asset quality, softening credit costs that is likely to
propel return ratios and burgeoning share of retail term deposits
which is likely to provide long-term stability to the source of funds
are the factors working in favour of private sector banks, say
analysts at Edelweiss Research. Axis Bank and ICICI Bank are their
preferred picks in this segment.
Meanwhile,
17 out of 31 stocks that comprise the S&P
BSE Sensex are still trading below their August 29, 2018 levels,
shows data. Tata Motors, Tata Motors DVRs, Mahindra & Mahindra
and Maruti Suzuki India have lost over 25 per each on the BSE during
this period.
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