Budget euphoria takes Sensex to 50K; Bank Nifty at record high

The Indian market continued its upward march for the second session on February 2, a day after Finance Minister Nirmala Sitharaman presented the Union Budget. The announcements revitalised bulls as they took Sensex to 50,000 and Bank Nifty to a record high.

Positive macro data further bolstered the already surging benchmark indices. In January 2021, exports grew 5.37 percent YoY to $ 27.24 billion driven by healthy growth in pharma and engineering sectors. The trade deficit during the month narrowed to $ 14.75 billion from $ 15.3 billion in January 2020, data showed. It was $ 15.44 billion in December 2020.

At close, the Sensex was up 1,197.11 points or 2.46% at 49,797.72, and the Nifty up 366.70 points or 2.57% at 14,647.90.

“Growth and capex oriented Budget has provided ammunition to the bulls as Sensex scaled mount 50k on an intraday basis. Several stocks notched up 52-week highs today in the broader market. The spectacular listing of the paint company surprised the street as it recorded huge gains on listing,” said S Ranganathan, Head of Research at LKP Securities.

Nifty Auto index rose 4 percent, while bank and infra indices gained 3 percent each. Nifty pharma, IT and energy indices jumped 2 percent each.

Broader markets performed in line with main indices with BSE Midcap and Smallcap indices adding 1-2 percent.

Tata Motors, Shree Cements, UltraTech Cement, SBI and Hindalco were among major gainers on the Nifty, while losers included HDFC Life, Bajaj Finserv, Hero MotoCorp, Titan Company and HUL.

Stocks & sectors

On the BSE, auto, bank, capital goods and realty indices jumped 3 percent each, while healthcare, IT, metal and oil & gas indices added 1-2 percent.

A volume spike of more than 100 percent was seen in Siemens, Escorts and Zee Entertainment.

Long buildup was seen in Dr Reddy’s Lab, Cummins and Zee Entertainment, while short buildup was seen in HUL, HDFC Life and Cholamandalam Financial Holdings.

Over 200 stocks including TVS Motor, Bajaj Auto and ICICI Bank hit a fresh 52-week high on the BSE.

Technical View

“In the next trading session, unless Nifty gets past 14,731 levels strength should not be expected. In case if the said hurdle is cleared then Nifty may register a new lifetime high which could extend to 15200 levels,” said Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory at Chartviewindia.in.

“Considering the strong up move of last two sessions, traders are advised to avoid fresh buying in the index and preference should be given to booking profits on long positions,” he added.