80K ECSTASY: SENSEX CROSSES MARK IN FASTEST 10K RALLY EVER

MUMBAI: The 30-scrip Bombay Stock Exchange sensex crossed the 80,000 mark for the first time on Wednesday, gaining 10,000 points in six and a half months, recording its fastest 10k rally in history.

The country's stock market has seen a stratospheric rise, reaching new milestones with spectacular regularity driven by a surge in retail investors and middle class India flocking to the market and lending strength to the support from foreign investors. Some experts say the sensex is poised for much higher gains after the Union Budget later this month, with some predicting it could reach 87,000 levels by the end of the year.

The rally was driven by HDFC Bank, which has the highest weightage in the sensex following the merger of HDFC with its banking arm. The NSE Nifty 50 closed with a gain of 0.7% at 24,286.5 points, while the sensex too increased by 0.7% to reach 79,986.8 points.

Shares of HDFC Bank gained 2.2% following the publication of its shareholding for the quarter ended June 2024. The shareholding revealed foreign holding in the bank had dipped to 54.8%.

Ironically, it was the sale of shares by foreign investors that triggered a re-rating of the stock.

The dip in foreign holding below 55%, increases floating stock available for global investors to a threshold level where its weightage in the MSCI Emerging Market Index is increased.

According to a research report, HDFC Bank's weightage in MSCI index could increase from 3.8% to around 7.5%. This could result in inflows of $3-$4 billion.

Tata Motors, Mahindra top sensex gainers since 40,000 pts

Adani Ports was the top gainer in the sensex on Wednesday despite Hindenburg Research being in the news again after it repeated its allegations against the group in a reply to Sebi’s showcause notice.

Adani Ports share price rose 2.5% on Wednesday, driven by its inclusion in the benchmark index this week. The company on Tuesday had also reported a big jump in container traffic handled in its port.

“Optimism in global equities weighed positively on Indian markets, which also propelled gains in other sectoral stocks, including the telecom counters. HDFC Bank led the recovery on the back of a potential increase in the bank’s weightage in the MSCI Emerging Markets index,” said Prashanth Tapse, senior VP, Mehta Equities.

Over a 5-year period, since the sensex hit 40,000, the top sensex gainers have been Tata Motors & Mahindra, surging 426% and 358%, respectively.

“The bulls have regained control from the bears, pushing the Nifty above 24,300. This shift in sentiment has once again favoured long trades in the market. Moving forward, the trend might remain strong in the near term as long as it stays above 24,000. On the higher end, the index might move towards 24,500. However, a fall below 24,000 could lead the index into consolidation,” said Rupak De, senior technical analyst, LKP Securities.