Security officers stand guard near a bronze bull statue at the entrance to the BSE. (Photographer: Adeel Halim/Bloomberg)

Weekly Wrap: Sensex, Nifty Rebound To Hit Record Highs On Strong Earnings

Equity benchmarks rebounded to hit all-time highs after Indian companies reported strong earnings in the April-June quarter overshadowing global trade war concerns.

The S&P BSE Sensex rose 2.3 percent to 37,337 and the NSE Nifty 50 index surged 2.44 percent to 11,278 during the week.

Fifteen of the 21 Nifty companies, that have reported June quarter earnings, either met or beaten estimates, data compiled by Bloomberg showed.

“The Nifty is likely to scale record highs and it can test 11,500 in the near term,” Sumeet Bagadia, associate director at Choice Broking, told BloombergQuint by phone.

The Nifty broke above 11,170 in yesterday’s session, a level from where it started correcting a couple of months ago. Now a break above that level indicates that it can give an up move of 300-400 points, Bagadia said.

Weekly Wrap: Sensex, Nifty Rebound To Hit Record Highs On Strong Earnings

Also read: Nifty’s Rally To Record Has An Eerie Similarity With 2008-Peak

UPL Ltd. was the week’s biggest gainer. The stock rose 15.6 percent, the most in over two years, to Rs 635 after it agreed to acquire agri-pesticide maker Arysta LifeScience Inc. for $4.2 billion in cash to become one of the world’s largest crop protection companies.

Weekly Wrap: Sensex, Nifty Rebound To Hit Record Highs On Strong Earnings

Also read: Nifty’s Journey To 11,000

The gains were broad-based as the Nifty 500 index outperformed the benchmark Nifty 50 index by rising 3.15 percent. Gains in the Nifty 500 were led by Shree Renuka Sugars, which rose over 30 percent.

Symphony and South Indian Bank were among the top losers after both of them posted weak June quarter earnings.

The mid- and small-cap shares also outperformed the benchmarks as the Nifty Midcap 100 index surged 4 percent and the Nifty Smallcap 100 index rose 5.3 percent.

Debt-free midcaps have started performing again and there can be a major up move for them as mutual fund reclassification for mid and small caps has been done away with, Vijay Chopra, managing director and chief executive officer of Enoch Ventures, told BloombergQuint.

The funds which had sold mid- and small-cap stocks on SEBI reclassification guidelines have probably started buying them back, Chopra said.

Weekly Wrap: Sensex, Nifty Rebound To Hit Record Highs On Strong Earnings

Also read: What Contributed To Nifty’s 1,000-Point Jump From March Low

All sector gauges barring the Nifty IT index ended higher, led by the Nifty PSU Bank Index’s 10.4 percent rally.

The Indian rupee rebounded from its previous week’s loss and appreciated 0.27 percent to 68.66 a dollar. The local currency’s weekly performance wasn’t the best among the Asian peers.

Expectations of buoyant capital inflows along with likely initial public offering-related inflows predominantly outweighed the impact of broad overnight dollar gains, helping the rupee touch a two-week high in early trade, newswire PTI reported.

Also read: Technical Indicators Suggest Mid Caps May Have Bottomed Out

Big Talking Points This Week

Nifty Earnings To Watch Next Week

  • Axis Bank.
  • HDFC.
  • Tech Mahindra.
  • Power Grid.
  • Tata Motors.
  • UPL.
  • Vedanta.
  • Indiabulls Housing Finance.
  • ONGC.
  • Titan Company.