Sensex Rallies 519 Points; Power and Realty Stocks Witness Buying

Indian share markets extended gains as the session progressed and ended on a strong note, driven by power stocks and realty stocks.

At the closing bell, the BSE Sensex stood higher by 519 points (up 1.5%).

Meanwhile, the NSE Nifty closed higher by 160 points (up 1.6%).

The SGX Nifty was trading at 10,473, up by 185 points, at the time of writing.

The BSE Mid Cap index ended up by 1.7%, while the BSE Small Cap index ended the day up by 1.8%.

On the sectoral front, gains were largely seen in the power sector and realty sector.

IT stocks were in focus today after US President Donald Trump suspended the entry into the United States of certain foreign workers.

Asian share markets bounced today after US President Donald Trump said the US-China trade pact was "fully intact", clarifying earlier confusing statements from the White House over the fate of the deal.

As of the most recent closing prices, the Nikkei ended up by 0.5% while the Shanghai Composite stood higher by 0.2%. The Hang Seng ended up by 1.6%.

The rupee is trading at 75.86 against the US$.

Gold prices are trading up by 0.1% at Rs 47,959 per 10 grams.

Moving on, market participants were tracking ICICI Prudential Life Insurance share price today.

Stock of the company has gained more than 7% in the past two days after the Government of Singapore acquired a more than 1% equity stake in the company through open market transactions.

The Government of Singapore bought 16.43 million equity shares, representing 1.14% of the total paid-up equity capital of ICICI Prudential, at Rs 391.6 per share on the NSE, the bulk deal data shows.

In news from the engineering sector, shares of Larsen & Toubro (L&T) were trading higher for the fourth straight day today. The stock jumped 7% intraday today after the company bagged large contracts worth more than Rs 25 billion.

In the past four trading days, the stock has rallied about 9.5% from Rs 884.55 on June 17.

The construction arm of L&T has secured orders from prestigious clients for its various businesses.

Although L&T did not mention the exact value of the contract, according to its project classification, the value of a 'large' order ranges in the range of Rs 25 to Rs 50 billion.

In a press release today, L&T said that its construction arm has secured an engineering, procurement and construction (EPC) contract for its transportation infrastructure business, to construct Packages 11 and 22 of the Delhi-Vadodara Expressway.

The company also secured an EPC contract from the state government for the reconstruction of the four-lane Tallah road overbridge in West Bengal.

L&T share price ended the day up by 6.8%.

Moving on, asset management companies (AMCs) were among the top buzzing stocks today.

Shares of AMCs rallied up to 14% today after UTI AMC received market regulator's nod for initial public offering (IPO) to raise Rs 30 billion.

Shares of Nippon Life India Asset Management surged about 14% while HDFC AMC rose 4%.

This will be the third public offering in the Indian mutual fund industry after Nippon Life Asset Management and HDFC AMC.

The IPO of the country's largest AMC in terms of total assets under management (AUM) comprises sale of 38,987,081 equity shares by existing shareholders, according to the draft red herring prospectus (DRHP).

State Bank of India (SBI), Life Insurance Corporation (LIC), and Bank of Baroda are offering to sell 10,459,949 shares each, while Punjab National Bank (PNB) and T Rowe Price International are planning to offload 3,803,617 shares each.

SBI, LIC, PNB, and BoB hold 18.5% stake each in UTI AMC. The US-based T Rowe Price holds 26% stake in the company.

Speaking of IPOs, in one of the editions of The 5 Minute WrapUp, Ankit Shah has shared how IPOs offer insights into the mood of the stock markets.

He picked the six most successful IPOs of 2019 and checked the retail investor enthusiasm for them.

Obviously, all these IPOs were oversubscribed across investor categories. But the level of retail investor enthusiasm differed widely, depending on the overall market sentiments.

This can be seen in the chart below:

Are Retail Investors Back in the IPO Game?

 

Here's what Ankit wrote about it...

• Clearly, IRCTC witnessed the highest number of bids for the retail category. Factoring in the discount of Rs 10 per share for the retail category, the total bids were worth a whopping Rs 3,242 crore. Over five times the entire IPO size!
  
  Polycab India and the recent IPO of CSB Bank also received a strong thumbs-up from retail investors.

Does this hint that retail investors are coming back to the markets? It would be interesting to see how this trend pans out in 2020.

We will keep you updated on all the developments from this space. Stay tuned!