Bulls Dominate Dalal Street, Sensex and Nifty Surge Over 2%

Bulls roared on the Indian benchmark indices on Friday as Sensex surged more than 1,961 points and Nifty 557 points, while the stock market witnessed a significant broad-based rally from the oversold territory, predominantly led by large-cap stocks.

The rally in financial stocks and strong US labour market data were among the factors that drove the Sensex and Nifty up more than 2 per cent. A rally in the blue-chip bank stocks also helped the benchmark indices jump in Friday's trade.

Sensex ended at 79,117.11 after gaining 1,961.32 points, or 2.54 per cent, and Nifty ended at 23,907.25 with a gain of 557.35 points, or 2.39 per cent.

This is the biggest bull run since June 5, when the BSE Sensex had advanced 3.20 per cent, or 2,303.19 points, to 74,382.24; while the NSE Nifty stood at 22,360.25, a rise of 3.36 per cent or 735.85 points.

Market observers now see corrections in the broader market as an opportunity to accumulate quality stocks with a higher capacity to withstand macroeconomic pressure.

"Despite global headwinds, the long term growth story remains compelling in India. Investors should focus on those sectors that are structured around themes like urbanization, infrastructure, and consumption growth. Strategic portfolio adjustments and disciplined investing with a long-term perspective remain key to weathering the current environment, said Krishna Appala of Capitalmind Research.

IT remains the sector likely to react most favourably to this easing of medium-term headwinds.

Head of Research at Geojit Financial Services, Vinod Nair said that positive momentum was seen in global markets also, as Japan's October inflation declined modestly and stimulus package announced worth 39 trillion yen. "Moderation in the global and domestic political drama provided relief to the domestic market," Nair added.

DIIs' strong buying and firm trends in the US markets further added to the recovery in domestic equities. The biggest gainers from the 30-share Sensex pack were State Bank of India (NS:SBI), ICICI Bank (NS:ICBK), IndusInd Bank (NS:INBK), Tata Motors (NS:TAMO), Power Grid (NS:PGRD), Bajaj Finance (NS:BJFN), Bajaj Finserv (NS:BJFS) and Tech Mahindra (NS:TEML).

Foreign Institutional Investors (FIIs) sold equities amounting to Rs 5,320.68 crore on Thursday, whereas DIIs purchased shares worth Rs 4,200.16 crore.