Investors gained Rs 7.68 lakh crore in market wealth this week on signs of relaxation in coronavirus lockdowns globally and central banks infusing liquidity in order to keep economies afloat. Encouraging results from a COVID-19 drug trial in the US turbocharged sentiment and short-covering on expiry of F&O contracts at home today also added to investor wealth.
Market capitalisation on BSE rose to Rs 129.41 lakh crore at the end of trade today compared to Rs 121.73 lakh crore market cap on April 24.
In the last four sessions, Sensex and Nifty have gained 2,388 points (7.63%) and 705 points (7.70%), respectively.
Today, Sensex closed 997 points higher to 33,717 and Nifty climbed 306 points to 9,859. Sensex has gained 4,249 points or 14.41% in April. Similarly, Nifty has gained 1,262 points or 14.67% this month.
Since March 23, Sensex has gained 7,736 points or 29.77%. Sensex saw its biggest intra day fall on that day. Nifty too has rallied 2,249 points or 29.55% compared to closing of 7,610 on March 23.
Vinod Nair, Head of Research at Geojit Financial Services said, "Markets this month were driven by hopes about easing of lockdown measures, stimulus packages by central banks and other steps to limit the unprecedented economic damage caused by the virus. So much so that, the current domestic earnings season has lost its relevance, in terms of numbers. Investors are looking forward to earnings guidance and commentary regarding the normalization of business and outlook."
A strengthening rupee and rising buzz of another stimulus package by the government, focused on industries, kept domestic investor sentiment positive, traders said.
Rupee has recovered 2.3% from its all time low of 76.91 hit on April 22. The currency closed 57 paise higher at 75.10 today.
"Nifty has posted its best monthly gain since April 2009, registering gains of over 14 per cent. Buying was seen among huge volumes on weekly F&O expiry day with old economy stocks (including auto, oil & gas, metals) advancing well accompanied by IT stocks. Asian markets rose on Thursday, carried by optimism overnight on Wall Street that a new drug could help to treat COVID-19," said Deepak Jasani, Head Of Research, HDFC Securities.
Of 30 Sensex stocks, 26 closed in green today.
ONGC was the top gainer on Sensex, rallying over 13 per cent, followed by HCL Tech, Hero MotoCorp, NTPC, TCS, M&M, Infosys and Maruti.
Sun Pharma, IndusInd Bank and Asian Paints were the top losers.
"Most major global markets have rallied in the current week as several countries have started to talk about lifting the lockdown," said Sanjeev Zarbade, VP PCG Research, Kotak Securities.
"Reports of encouraging results about Gilead's drug in treating COVID-19 as well as starting of human trials on a vaccine also fuelled the rally," he added.
On BSE, 31 stocks hit 52 week highs against 70 touching 52 week low in trade today. BSE metal index rose 8.27 per cent, followed by auto, IT, teck, oil and gas, basic materials, telecom and energy.
On the other hand, healthcare and FMCG indices ended in the red. Total 248 stocks hit their upper circuits against 226 falling to their lower circuits on BSE.
Shibani Sircar Kurian, Executive Vice President, Head- Equity Research at Kotak Mahindra AMC said, "Markets this week rallied from the lows seen in March 2020. After almost a month of lockdown the world over, early signs of easing of the same along with some signs of the flattening of the COVID -19 curve spurred hope of economic activity resuming albeit at a slow pace. Some promise of a possible cure with positive preliminary results of a few drugs also added to hope and optimism.
Central banks the world over have joined hands to pump in liquidity in order to keep economies afloat. The US Fed kept interest rates near zero and stated that they would be willing use all necessary tools and act as appropriate to support the economy. Meanwhile, data from China seems to suggest some resumption of economic activity as the government eased the lockdown. China Purchasing Managers' Index (PMI) stood at 50.8 and continued to show expansion though it was a drop from the March level."
Top US epidemiologist Anthony Fauci said that Gilead Science's remdesivir "has a clear-cut, significant, positive effect in diminishing the time to recovery". The development led to a rally in Asian stocks.
Japan's benchmark Nikkei 225 surged 2.1% to finish at 20,193.69, while Australia's S&P/ASX 200 gained 2.4% to 5,522.40. The Shanghai Composite added 1.3% to 2,860.08.
Markets in South Korea and Hong Kong were closed for holidays. Many other markets will be closed on Friday for May Day.