Mumbai: After a gap of five years, benchmark stock indices Sensex and Nifty scaled new highs as robust FII inflows and hopes of wider reforms after the 2014 Lok Sabha elections helped to overcome concerns over slowing economic growth and high inflation.
Raghuram Rajan assuming the office of RBI Governor in September and a strong showing by the BJP in assembly elections also contributed to stock indices breaking their previous all-time highs.
If 2012 was a year that saw Indian bourses scripting a dramatic turnaround after the meltdown, 2013 was marked by consolidation in the first half and a new found optimism by market participants in the second half.
While markets succumbed to decade-low economic growth, inflation, high interest rates, a widening current account deficit and a weak rupee for most of the year, a slew of positive factors led to change in sentiment thereafter.
The Federal Reserve, which had hinted at trimming its monthly USD 85 billion stimulus back in May, finally announced a USD 10 billion cut, helping the markets stabilise as a keenly awaited event was over.
After vacillating in a tight range for a major part of the calendar year, the BSE Sensex recorded a new intra-day high of 21,483.74 on December 9. In 2013 so far, the 30-share index has risen by 1,653.03 points or 8.5 per cent, from the 2012 close of 19,426.71.
Last year, it gained 26 per cent. In 2013, best performing bluechips include TCS (up 68.41 pc), Infosys (53.22 pc), Wipro (39.20 pc), Dr Reddy's (37.21 pc), Maruti Suzuki (21.56 pc) and Tata Motors (19.41 pc).
However, Jindal Steel tumbled by 44.01 per cent, followed by L&T (33.89 pc), BHEL (27.52 pc), SBI (26.51 pc), Sun Pharma (21.31 pc), Coal India (19.94 pc) and Tata Power (17.90 pc).
The 50-issue CNX Nifty of the National Stock Exchange (NSE) also moved similarly to log a new intra-day high of 6,415.25 on December 20. It has gained 369.15 points, or 6.25 per cent, since its last year's close of 5,905.10.
In terms of market capitalisation, investor wealth rose by Rs 20,258 crore to around Rs 69.4 lakh crore across stocks. However, second-line stocks underperformed the benchmark indices as retail investors preferred to stay away.
The BSE-Smallcap and BSE-Midcap indices closed down by 14.92 per cent and 8.58 per cent, respectively.
IT, Pharma, FMCG, Auto and Oil&gas sector registered sharp to moderate gains while Realty, Consumer Durable, Power, Metal, Capital Goods and Banking posted losses. The key market driver Foreign Institutional Investors (FIIs) bought shares worth over Rs 1.1 lakh crore (nearly USD 20 billion) till December 19. Last year, overseas investors had pumped in Rs 1.28 lakh crore (USD 24.37 billion).
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