The recovery in late trade helped the market end at fresh record closing high on Friday, largely supported by index heavyweights ICICI Bank, Reliance Industries and HDFC. In fact, the year 2018 has begun on a strong note as benchmark indices ended both weeks at record closing highs.
December quarter earnings, so far, have been good. Infosys, TCS and IndusInd Bank numbers were largely in line while Karnataka Bank posted strong Q3 with asset quality improvement.
The market fell nearly half a percent intraday after four Supreme Court judges raised concerns over administration of the top court but that petered out soon.
The 30-share BSE Sensex was up 88.90 points to close at 34,592.39 and the 50-share NSE Nifty gained 30.10 points at 10,681.30. For the week, the Sensex gained 1.3 percent and Nifty rose 1.15 percent despite Brent crude oil futures hit USD 70 a barrel level.
“Market will react to the macroeconomic data viz. IIP and CPI inflation data and earnings of another IT major, Infosys in early trade on Monday i.e. January 15,” Jayant Manglik, President, Religare Broking said.
Banking is still shying away from its record high and its participation holds the key for the next directional move, he feels. “Traders should restrict naked leveraged positions and suggest using intermediate dip as buying opportunity,” he advised.
The broader markets also recovered in late trade but failed to close in the green due to weak breadth. About 1,555 shares declined against 1,348 advancing shares on the BSE.
Infosys shares recovered in late trade to close 0.25 percent higher. Infosys in its after market hours earnings report said profit grew by 37.6 percent on tax reversal and full year constant currency revenue guidance maintained.
TCS shed half a percent on profit booking, as December quarter earnings were largely in line with estimates. Karnataka Bank rose 2.6 percent as profit grew by 28 percent with improvement in asset quality.
ICICI Bank was biggest gainer and contributor to Nifty’s gains, rising 2.65 percent followed by Reliance Industries (up 1.2 percent) and HDFC (1.13 percent). Vedanta, Maruti Suzuki, Bharti Infratel, Zee Entertainment and HPCL gained 1-2 percent.
ITC, HDFC, Axis Bank, Bharti Airtel and Yes Bank, which fell 0.4-1 percent, capped gains of the market.
Amtek Auto was locked at 5 percent upper circuit after a media report indicated that UK-based metal group Liberty House and US-registered hedge fund Deccan Value Investors have emerged as top contenders for the auto component maker.
KEI Industries spiked 9 percent and Motilal Oswal has initiated coverage with Buy rating on the stock with target price at Rs 537, implying potential upside of 44 percent as the company is expected to be major beneficiary of key government initiatives.
MAS Financial Services gained 3 percent after Motilal Oswal initiated coverage with Buy call on the stock and target price of Rs 740, implying 18 percent potential upside as it is an efficient player in high growth product segment.
Reliance Nippon, Gujarat Pipavav, DEN Networks, Firstsource, Just Dial and Tata Global among others gained 4-20 percent.
On the global front, European shares were mildly higher at the time of writing this article as investors digested new earnings, data and a political breakthrough in Germany. Asian markets closed mostly higher.