Markets cheer Greece package

Tribune News Service

New Delhi, July 13

Indian stock markets rallied today mirroring the movement in other Asian and European markets after the European Union ratified a bailout package for Greece.

The benchmark BSE Sensex regained the 28,000-mark and ended up by 300 points for the second day to 27,961 points, its biggest single-day gain in three weeks.

However, analysts said movements in China will have a greater impact on the Indian markets and economy.

Dhananjay Sinha, Head of Research, Economist & Strategist, Emkay Global Financial Services, said, “Developments in Greece are relevant to Indian markets to the extent that it has a bearing on the broader global market sentiment. In the event of Grexit, the risk off would have triggered off the volatility in equities and thus would have resultant spillover effect on India”.

He added that the development in China and volatility in its markets would be more relevant for emerging markets, including India.

The government said today the ongoing developments in Greece have only indirect implications for India and their impact.

Finance Secretary Rajiv Mehrishi said, “We are only indirectly affected by the Greek crisis. If there was any adverse impact (it) is difficult to quantify. Then there would be a positive impact also which is also difficult to quantify".

Sanjeev Zarbade, vice-president-PCG Research, Kotak Securities, said going ahead, monsoons, reforms and the events in China and the Fed decision on interest rates will be important triggers for global markets.

Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services, said an easing of crude prices provided the additional strength to the Indian market which was initiated by global rally led by Greece bailout. The new Greece bailout deal will provide an immediate relief to global risk.

The 30-share index regained the psychological 28,000-mark — for the first time since July 8 — by surging 340.43 points, or 1.23%, at 28,001.83 in the afternoon trade.

Sentiment got a push after global markets climbed following Greek developments today, which had stretched into marathon overnight talks in an attempt to prevent its potential exit from the single currency union, brokers said.

All sectoral indices led by IT, technology and healthcare, were trading in the positive zone with gains of up to 1.69%.