Rupee’s recovery spurs stock market

Indian benchmark equity indices rose to new highs on Monday as investor sentiments were lifted on account of a positive trend across most leading Asian markets and a recovery in the rupee against the dollar. The 30-share Sensex gained 330.87 points or 0.87% to close at a new high of 38,278.75 with 23 of its constituents gaining ground. Auto and metal majors like Tata Steel, Tata Motors, Bajaj Auto and Vedanta were among the top gainers of the day. Infosys, meanwhile, was the first performer among the Sensex pack on Monday, shedding over 3% or Rs. 46.15 to close at Rs. 1,385.20 after the company’s chief financial officer M.D. Ranganath resigned on Saturday. The broader Nifty breached the 11,500-mark for the first time, gaining 81 points to close at 11,551.75. Among other major Asian markets, Hang Seng gained 385 points. Mid-cap and small-cap stocks have been gaining ground in the last few trading sessions. “Despite the correction this year, we still believe that mid-cap stocks are expensive,” said Mukul Kochhar, Head Institutional Sales, Investec Capital Services. “The only difference now (versus a few months back) is that politics looks more stable – prospects of an Opposition coalition are looking a little shaky,” he said, while adding that rupee remains at risk and that could help technology companies. The rupee opened stronger on Monday compared to its previous close of 70.16 a dollar and appreciated 0.47% or 33 paise to close the day at 69.83 a dollar.

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