Investors' wealth zooms over Rs 2 lakh crore as Sensex, Nifty hit new highs

Investors wealth increased by over Rs 2.30 lakh crore on Tuesday as the market extended its gain for the second straight session tracking gains in index majors including HDFC twins, Infosys, TCS, ICICI Bank amid largely supported by positive macroeconomic indicators.

The market capitalisation of BSE-listed firms jumped to an all-time high of Rs 240.04 lakh crore in the late trade against Rs 237.74 lakh crore on Monday.

VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services said, “Fundamental support to the bulls has been coming from good corporate results. Now the macros are turning very positive with the declining fiscal deficit, rising tax collections, and now the excellent performance in exports which have shot by 48% in July. The PMI at 55.3 indicates a potential sharp turnaround in economic activity.”

Goods and Services Tax (GST) collection increased by 33% year-on-year in July to over Rs 1.16 lakh crore, indicating that the economy is recovering at a fast pace. The collection stood at Rs 87,422 crore in June. This is the second-highest collection so far this fiscal after a record Rs 1.41 lakh crore mop-up in April.

The 50-share NSE Nifty index gained 245.60 points or 1.55% to end at an all-time high of 16,130.75. Likewise, the 30-share Sensex gained 872.73 points or 1.65% to an all-time high of 53,823.

Rahul Sharma, co-founder, Equity99 said, “It is a historical day for us as Nifty scaled the crucial 16,000-mark. This surge in the market is backed up with a strong performance from the industry leaders like HDFC from banking space, TCS and Infosys from IT pack, big support is coming from FMCG giants like UBL, Britannia, Marico.”

He further added that the level of 16,150 and 16,200 will act as resistance to the index.

Among the sectoral indices on BSE, the FMCG index gained the most 1.62%. It was followed by Auto (up 1.61%), Bankex (1.48%), Telecom (up 1.47%), Finance (up 1.37%) and IT (up 1.30%). Barring the BSE Metal index (down 0.07%), other sectoral indices also ended the day in the green.

Sneha Poddar, AVP-research, broking and distribution, Motilal Oswal Financial Services said, “Nifty today finally managed to break its two-month long consolidation to touch the most awaited level of 16,000. It had shown strong resilience since the start of June and moved in a very narrow range despite weak global cues and finally managed to leap forward towards the 16,000 zone. What really provided support to the market was the Q1FY22 earnings report which begun on a very healthy note despite the Covid 2.0 impact. It helped the market to largely sail through the headwinds of a possible third Covid wave, commodity led inflation and volatility around the US Fed taper talk.”

She further added that the damage from the second Covid wave and the consequent lockdowns in April 2021 and May 2021 has been much lesser than that from the Q1FY21 national lockdown. Management commentaries across the board suggest an improved demand environment post June’21, led by the easing of restrictions, lower active Covid-19 cases, and a pickup in vaccinations.

“We estimate corporate earnings to continue to recover, as the underlying economy opens up, with progressively higher vaccination trends, thus offering many bottom-up opportunities,” Poddar said.