Bulls fight back, recover Monday’s losses; investors earn Rs 6.3 lakh crore in three days

The holiday-shortened week was a volatile one for domestic benchmark indices, but both Sensex and Nifty came out with flying colours in the end. S&P BSE Sensex tumbled a massive 1,500 points or 3.2% on Monday while the 50-stock Nifty tanked 461 points or 3.36%, as the world digested the sour news of a new coronavirus strain found in the United Kingdom. But the bulls came running back in the subsequent session, helping the benchmark recovery nearly all losses suffered. Sensex closed yesterday at 46,973 while Nifty ended at 13,749, both just a tad bit below their all-time highs. So what helped them recover these losses?

“On the first day of the week, our market witnessed vertical decline mainly due to ‘imported bearishness’ from the world market. However, the anticipation of fresh infusion of nearly $2.3 trillion in the economy from the US federal and likely possibilities of the Brexit deal over the weekend helped the market to bounce back from lower levels,” said Shrikant Chouhan, Executive VP, Equity Technical Research at Kotak Securities. 

Foreign investors not losing faith

Despite the sharp fall witnessed on Monday, Foreign Institutional Investors (FII) did not run out on Indian markets. After pulling away Rs 323 crore on Monday, FII were net buyers of Rs 2,915 crore worth domestic securities in the last three trading sessions. With this, FIIs have now invested Rs 62,648 crore in domestic equity and debt so far in December, just a little bit shy of Rs 62,782 crore they invested in November. The knee-jerk reaction to a piece of negative news on Monday showed the strength of bulls. “… Monday’s short-lived fall failed to deteriorate FPIs interest in Indian equities who continued to remain net buyers this week, courtesy low-interest rates and surplus global liquidity,” said Nirali Shah, Senior Research Analyst, Samco Securities.

Investors richer by Rs 6.39 lakh crore in three day

After suffering massive losses on Monday the market capitalization of all BSE listed firms dropped to Rs 178.79 lakh crore on Monday, down from 185.38 lakh crore at the end of the previous week. However, bulls fought back and as the market recovered losses, investors earned Rs 6.39 lakh crore in three trading session as the market capitalization zoomed to Rs 185.18 lakh crore.

Top gainers and losers

Among BSE Sensex constituents, Information Technology (IT) stocks were shining bright after being the top performers. Infosys was the top gainer on Sensex, followed by HCL Technologies. These were backed by another defensive stock Hindustan Unilever. Sun Pharma, Bajaj Auto and Asian Paints were the other gainers. 

Failing to ride the momentum this week were IndusInd Bank as the top Sensex drag, followed by ONGC, NTPC, and Bajaj Finserv. 

Benchmark outperform broader markets

Although broader markets showed some fighting spirit during the week and at times closed a tad bit higher than the benchmarks, overall it was Sensex and Nifty that ended the week with gains. BSE Midcap and Smallcap indices closed less than 1% lower from their closing levels of the previous week but Sensex managed to gain on the weekly charts.