Sensex climbs 395 points, Nifty ends at 15,834; realty, financial stocks lead

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Indian equity benchmarks closed higher on Monday tracking gains in index heavyweights RIL, HDFC Bank, ICICI Bank and Infosys. Sensex ended 395 points or 0.75% higher at 52,880, while Nifty settled at 15,834, up 112 points or 0.71%. Healthy buying was seen across realty, banks, financials & metal counters despite contraction in manufacturing PMI.

“Domestic indices witnessed a gap-up opening and maintained the levels despite mixed sentiments seen in global equities. In line with contraction in manufacturing PMI, India’s Service PMI for June fell to 41.2 against 46.4 in May, having no negative impression on the market. A strong US job data signalled that the economy is recovering at a steady pace which eased concerns over an earlier-than-expected interest rate hike by the Fed. The overall optimism boosted appetite for most sectors barring IT and Pharma, while small and mid-cap stocks continued their outperformance,” said Vinod Nair, Head of Research at Geojit Financial Services.

Gainers & losers

New listing

Shares of India Pesticides made a strong debut on the bourses as they got listed at Rs 360, commanding a 22 per cent premium over the issue price of Rs 296 on the BSE. However, the shares ended at Rs 342 apiece below its listing price as mild profit booking was witnessed at higher levels. The scrip touched an intraday high of Rs 368.

Economy

The seasonally adjusted India Services Business Activity Index (India Services PMI) stood at 41.2 in June 2021, highlighting a further contraction in output. Moreover, falling from 46.4 in May 2021, the latest reading pointed to the fastest rate of reduction since July 2020. Monitored companies commonly indicated that the intensification of the COVID-19 crisis and tight restrictions curbed demand for services. Subdued demand conditions resulted in a second successive monthly drop in new business received by services firms. The pace of contraction was sharp and the quickest since July 2020.

Meanwhile, India’s merchandise exports in June 2021 was at $32.46 billion, an increase of 47.34% over $22.03 billion in June 2020 and an increase of 29.7% over $25.03 billion in June 2019. Merchandise imports in June 2021 were $41.86 billion, an increase of 96.33% over $21.32 billion in June 2020 and an increase of 2.03% over $41.03 billion in June 2019.

Sectoral strand

Barring Nifty Pharma & Nifty IT all other sectoral indices ended in the green. Nifty Realty rose the most 2.73%, followed by Nifty Bank & Nifty Metal advancing 1.16% each. Nifty PSU Bank settled with gains of 0.93%, Nifty Auto & Nifty FMCG indices rose 0.57% & 0.48% respectively.

Nifty IT closed 0.20% lower and the Nifty Pharma ended with a marginal loss of 0.02%.

Broader market

The broader market ended mixed as the BSE MidCap index closed at 22,585 with gains of 0.35% while the BSE SmallCap index rose 0.78% to settle at 25,765 after hitting an all-time high of 25,809. Shares like Route Mobile, TTK Prestige, Tata Elxsi, Tata Coffee, Tata Communications, PNC Infratech, CCL Products, Action Construction Equipment, Dollar Industries and JK Paper hit their respective record highs today.

Market breadth remained strong throughout the day as 1,335 shares on the BSE advanced, while 655 declined and 322 remained unchanged.

Global markets

Shares in Europe and Asia were mixed on Monday. A private survey on China’s services sector activity in June showed growth slowing sharply in June to a 14-month low. The Caixin/Markit services Purchasing Managers’ Index for June, released Monday, came in at 50.3 — a significant decline from May’s reading of 55.1.

US markets will remain shut on Monday in observance of Independence Day.