Mumbai– The Sensex and Nifty on Monday gained in early trade on optimism over reports that the government will soon announce a stimulus package to revive growth in the economy. However, with no such announcement made till close, the markets finished with little gains.
The Sensex closed at 37,402.49, merely 52.16 points higher than Friday’s close of 37,350.33, while the Nifty edged higher by 6.10 points, or 0.06 per cent, to 11,053.90.
“Hopes of an early round of stimulus seem to have faded resulting in profit
booking towards the end of the session,” said Deepak Jasani of HDFC Securities.
Currently, sectors like automobile and manufacturing sectors are experiencing a crippling slowdown.
Automobile sales saw the worst figures in 19 years due to lack of demand. This has caused huge job losses, while several auto companies like Maruti, Ashok Leyland and Hero MotoCorp have, in recent times, temporarily suspended production for varying durations to cut losses.
optimism and rebound in IT and pharma stocks provided an initial push to
the market but the bulls failed to maintain the momentum due to absence
of earnings growth,” said Vinod Nair, Head of Research, Geojit
Nair added that the market is expecting a solid intervention by government to revive the economy, and until such announcements are made, volatility may continue.
Globally, equity markets rose on Monday on signs that major economies would look to prop up stalling growth with fresh stimulus measures.
Hopes of government action to stave off fears of recession – triggered by an inversion in the US bond yield curve – grew as China’s central bank unveiled interest rate reforms expected to lower corporate borrowing costs. (IANS)