Nifty Touches Its All-Time High; Telecom Stocks Witness Buying

After opening the day on a positive note, Indian share markets have continued their momentum and are presently trading in the green. Sectoral indices are trading on a positive note with stocks in the telecom sector and energy sector leading the gains.

The BSE Sensex is trading up 193 points (up 0.7%) and the NSE Nifty is trading up 58 points (up 0.6%). The BSE Mid Cap index is trading up by 1%, while the BSE Small Cap index is trading up by 0.8%. The rupee is trading at 64.27 to the US$.

Indian stock markets are witnessing buying interest today on the back of a host of domestic as well as global factors. A spurt in the Nifty Bank index has aided the rally for Nifty50, which touched its all-time high today. The momentum is also seen ahead of the French presidential elections and quarterly result announcements of Indian companies.

Apart from that, government think tank NITI Aayog has presented a glimpse of Vision 2031-32. As per the news, NITI Aayog has envisaged a new India in which all citizens in 15 years will have houses with toilets, two-wheelers or cars, power, air conditioners and digital connectivity.

All the above data comes as a welcome breather for Indian financial markets. The only question is will the Indian economy and Indian stock markets continue this momentum?

As far as the Indian economy is concerned, there are considerable challenges that lie ahead which the government seriously needs to address.

For Indian stock markets, our research in March revealed that, in aggregate, the profit margins of Sensex companies were trading at ten-year lows. So, if profit margins were to revert to their long-term averages, the Sensex may hit 40,000 three to four years down the line. To know more on this, you can download our Sensex 40,000 report.

In the news from global financial markets, Britain’s attempt to exit from the European Union (Brexit), has just took a new twist. Britain’s prime minister, Theresa May, has decided to capitalize on her party’s 18% lead in the opinion polls. This week, she called for a snap general election on June 8. This could stymie a real Brexit.