'India has good growth potential and the rest of the world will now look at India in times of global turmoil.'
Nothing seems to be stopping the bull run of Indian markets, not even the Brexit vote which pushed global equities in a volatile territory, as the Nifty on Thursday closed at its highest level in 2016.
After losing 180 points last Friday, when the surprise outcome of Brexit vote led to panic globally, the Nifty seems to have moved on.
Indian stock markets have rallied in four consecutive trading sessions since Friday, erasing the losses after Brexit, as market participants are confident about the prospects of the Indian economy.
On Thursday, the Nifty closed at 8,287.75 points.
Even on an intra-day basis, the Nifty touched 8,308.15, previously seen in October 2015.
The BSE Sensex gained 2.3 per cent over last week to close at 26,999.72 on Thursday.
The benchmark index was 1 per cent higher over Wednesday’s close.
The Bloomberg Comm-odity index is also near its six-month high, achieved earlier this month.
On a half-year basis, the index has gained the most in the first six months of 2016 since 2010.
“The market position from here on is expected to go up,” said Deven Choksey, managing director, KR Choksey Shares & Securities.
He further said, “Brexit has turned into a sort of blessing in disguise for India as crude oil prices have fallen, good for corporate earnings.”
In commodities, gold was up 24.3 per cent in the first half of 2016, while silver advanced 32.8 per cent.
Sugar, soybean meal and zinc were the other top performing components of the Bloomberg Commodity index.
Other factors such as the Seventh Pay Commission award, progress of the monsoon, possibility of passage of the goods and services tax Bill in the monsoon session of Parliament and expectations of good results in the June 2016 quarter have also buoyed the sentiment on Dalal Street.
“India has good growth potential and the rest of the world will now look at India in times of global turmoil.
"This can help more money come to India,” added Choksey.
Vetri Subramaniam, chief investment officer, Invesco Mutual Fund said, "Markets around the world are recovering post Brexit.
"As far as India is concerned, the focus will be on the strength of the recovery.
"A lot more will now depend on the visibility of earnings growth."
He further said, "The good news is that there is no financial dislocation because of Brexit."
It was also the last day of the June derivatives contracts.
Chandan Taparia, derivatives analyst at Anand Rathi said, around 77 per cent of the contracts were rolled over, which was better than the past six-month average, indicating that participants were carrying their position to the next month in the hope of further upside.
Choksey added, "We see the 8,300-point level as a base for the markets. In this financial year, we expect markets to reach 8,700- 9,000 points."
Asian markets too ended positive as Brexit fears seem to settle down on expectations that global central banks would be able to steer the global economy from financial problems.
Indices such as Nikkei, Hang Seng and Straits Times closed higher than Wednesday.
However, major European indices were trading mixed on Thursday afternoon.
Among the individual stocks, Dr Reddy’s Laboratories, Axis Bank, Tata Motors and Tata Steel were among the major Sensex gainers on Thursday, ending 2-4 per cent higher over previous close.
Continuing their rally from Wednesday, consumer stocks such as Asian Paints, Hero MotoCorp and Hindustan Unilever gained between 1-2 per cent each over previous close.
Meanwhile, foreign institutional investors showed confidence in the domestic equities as they were net buyers to the tune of Rs 1,107.42 crore (Rs 11.07 billion) on Thursday as per the provisional stock exchange data.
Image: A stock trader reacts. Photograph: Reuters