The benchmark indices continued their rise for the third consecutive day, with the Bombay Stock Exchange’s 30-share Sensex breaching the psychological mark of 17,000 after almost six weeks. It had closed above 17,000 on January 21.
While stocks across sectors gained ground, realty stocks stole the show after having been in the doldrums since the government announced the Budget for 2010-11. Other than realty stocks, Reliance Industries, ICICI Bank and HDFC led the rise.
Foreign institutional investors (FIIs) also continued their buying, with provisional data showing they were net buyers at Rs 959 crore on Wednesday, while domestic institutional investors were net sellers to the tune of Rs 187 crore.
The Sensex touched an intra-day high of 17,012.61, before closing at 17,000.01. It gained 1.36 per cent, or 227.45 points. In BSE, as many as 1,965 stocks gained ground, while there were 891 losers. The broader Nifty of the National Stock Exchange ended the day at 5,088.10, up 1.4 per cent, or 71.10 points.
The BSE Realty index outpaced the Sensex and ended the day among the top performers. Realty stocks saw hectic buying, even while most analysts felt the upside to the sector had been capped. They attributed Wednesday's rally in these stocks to a technical bounceback after the recent correction. The BSE Realty index gained 70 points, or 2.16 per cent, to close at 3,316.83. The index was the second-best performer of the day, closely following the BSE Oil & Gas index, which surged 2.28 per cent. Most of the real estate sector heavyweights gained impressive ground on Wednesday.
Ansal Properties rose 4.1 per cent to close at Rs 71.80. Indiabulls Real Estate gained 3.50 per cent, or Rs 5.60, to end the day at Rs 165.40. Sector heavyweights DLF, Unitech and Sobha Developers rose more than 2 per cent. “Some bounce-back was expected in the real estate arena after the recent correction,” said Ambareesh Baliga, vice-president, Karvy Stock Broking. “The Budget was not too kind to the real estate sector and so it came under heavy selling pressure. While we did see a surge in these stocks, I think the upside is limited,” said Baliga.
The realty sector's lacklustre performance can also be gauged by the fact that the BSE Realty index lost over six per cent in the past month, while the Sensex gained over three per cent in the same period. "Realty stocks have relatively underperformed to the broader markets after the Budget. Some value buying is seen in these stocks," said Sailav Kaji, director (institutional equities) at Fiduciary Euromax. Kaji said people are also hopeful that a better economy would help the sector do well.