A family watches share prices on a digital broadcast on the facade of the Bombay Stock Exchange on Monday
A family watches share prices on a digital broadcast on the facade of the Bombay Stock Exchange on Monday

Mumbai : Spurred by better than expected gross domestic product (GDP) growth data for April-Jun, the BSE Sensex surged to a historic peak of 26,900.30 points and Nifty crossed 8,000 level for the first time on aggressive buying particularly in auto, metal and banking counters.

The 30-share Sensex, however, settled at 26,867.55 — new closing high — with gains of 229.44 points or 0.86 per cent over the previous close. In the last five trading sessions, the Sensex has been scaling new closing peaks. The 50-share Nifty crossed the 8,000 level for the first time and closed at 8,027.70, a net gain of 73.35 points or 0.92 per cent. The Nifty touched all time high of 8,035.00 in intra-day trade. It took 78 trading sessions from May 12 to reach the 8,000-mark from 7,000 points.

 Sentiments turned bullish as foreign capital inflows picked up after economic growth improved to two-and-a-half year high of 5.7 per cent in the April-June quarter, brokers said.

The market also got a boost after Prime Minister Narendra Modi promised to remove roadblocks to foreign investment and said that economy was out of difficult situation and more reforms were in the offing.

Investors shrugged off weak manufacturing data by HSBC that fell to 52.4 in August from a 17-month high of 53.0 in July as business conditions in the capital goods category deteriorated.

Bank Nifty closed above the 16000-point mark for the first time ever, at 16012.80, up 1.7% from previous close.

HeroMoto Corp was the biggest Sensex gainer as it jumped 5.79 per cent. Maruti Suzuki climbed 4.71 per cent.

Larsen and Toubro, Hindalco, ONGC, GAIL, Reliance Industries, Cipla, Coal India, Sesa Sterlite, Tata Power, Tata Steel, Infosys and NTPC posted gains in the range of 1 per cent to 3.62 per cent.

“The stellar run for Indian equity markets continued on the back of better than expected GDP data and an increased conviction amongst the investing community on equities as an asset class for the next three to five years,” Devang Mehta, SVP & Head Equity Advisory & Retail Sales, Anand Rathi Financial Services Ltd, said.

Strong sales number in August posted by some auto makers, including Maruti Suzuki, was another positive factor for the markets, brokers said, adding that operators preferred to go long on the first day of September series.

Bank of America Merrill Lynch, in its report on Monday, expects markets to correct about 5 per cent over the next 2 months but is bullish in the long-term, adding that buying in dips is a “compelling strategy”. It said the cyclical recovery coupled with policy reforms would eventually lead to an improvement in profitability of Indian companies.

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