Indian equities continued their gaining streak this week, with the benchmark Sensex and Nifty closing at record high in a broad-based rally, as investors gave thumbs-up to Narendra Modi-led NDA government's three years in office.
The fantastic rally was also supported by sustained fund inflows and strong corporate earnings by frontline bluechip stocks such as ITC, Hindustan Petroleum. ITC jumped 2 per cent after FMCG major reported a 12.13 per cent growth in its standalone net profit at Rs 2,669.47 crore for the fourth quarter ended March 31, 2017, helped by spurt in revenue from cigarette segment.
Clearly, the rally is driven by solid robust inflows from domestic institutions, particularly mutual funds. It is unlikely that the trend would stop anytime soon. Brokers are of the opinion that there would be a Modi government in 2019, which means investors are willing to bet on stocks for the next 7 years.
Pharma stocks were down in the dumps this week, with Lupin, Aurobindo, Sun, Glenmark all hitting their new 52-week lows. Results from Lupin were bad, while Sun Pharma too reported lower than expected numbers. On Monday results of Aurobindo would be closely watched for cues.
Robust inflows into domestic mutual funds may push markets higher. On Friday domestic institutions net bought in the markets to the tune of Rs 1,000 crores. The flows are likely to continue for somemore time.