Wednesday, 10 January 2018

Sensex shrugs off FDI reforms ahead of budget 2018, eyes Q3 results

FDI

A slew of FDI reforms failed to enthuse the markets on Wednesday as participants held back fresh bets ahead of the corporate results season.

In big bang reforms ahead of the Budget, the government on Wednesday permitted foreign airlines to invest up to 49 per cent in debt-ridden Air India, and eased norms for investment in single brand retail, construction and power exchanges.

However, the benchmarks Sensex and Nifty slipped from record highs as caution crept in ahead of the earnings season, which will kick off tomorrow with TCS announcing its Q3 numbers, followed by Infosys on Friday.

The 30-share Sensex opened with strength and rallied to a fresh life-time high of 34,565.63. However, it succumbed to profit booking, before finally ending at 34,433.07 points, down by 10.12 points, or 0.03 per cent.

The gauge had rallied 649.81 points in the previous four sessions on widespread buying and sustained foreign fund inflows.

The broader NSE Nifty index too finished lower by 4.80 points, or 0.05 per cent, at 10,632.20. Intra-day, it hit a high of 10,655.50 and a low of 10,592.70.

"Investors turned little nervous ahead of earnings season while outperformance of IT index on account of relief on US H1B visa norms and expectation of positive outlook helped to recoup the losses.

"Though the market trend is positive we are bound to see some volatility in the short-term. Caution before the final budget outcome, CPI inflation and oil prices may impact the premium valuation," said Vinod Nair, Head of Research, Geojit Financial Services.

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