Nifty sets new record, Sensex stuck at 30,024
21 additional scrips make the difference
The broader stock market index NSE Nifty 50 on Tuesday set an all-time high of 9,306.60 on buying support triggered by corporate earnings. Curiously enough, its BSE counterpart 30-share Sensex failed to set any new record, though it did register a gain of nearly 290 points. What made the difference is 21 scrips that aren’t common constituents of the 2 indices.
In fact, both Sensex and Nifty set record highs in March, 2015, with the former trading at 30,024.74 points and the later touching 9,119.20. Since then, Nifty had recorded new highs several times, but Sensex record is stuck at 30,024. The 30-share index though crossed the psychological mark of 30,000 on April 5. Analysts said the performance of 21 Nifty alone stocks—20 additional stocks in plus Tata Motors DVR—explains this dissimilarity.
Also, the bull run entering new sectors like bank and cement, which have better representation in Nifty 50 and not finding enough representation in Sensex, is leading to uneven movement in the two benchmarks lately.
An analysis of year-to-date gains by these 21 Nifty 50 stocks showed 15 of them made double-digit gains of 10-49.36 per cent while only two gained in single digit and four of them showed negative returns. At the same time, of the 30 Sensex constituents, which are also part of Nifty 50 index, eight stocks showed negative return YTD and six showed single digit return while remaining 16 showed double digit return of 10-32.25 per cent, corporate data firm Capitaline’s data showed.

The 21 Nifty 50 stocks include Indiabulls Housing Finance, Ultratech Cement, which touched all-time high, Bank of Baroda and Tech Mahindra.
Technical analysts, however, find the disparity as a short-term phenomenon which is likely to be corrected in the long run.
Anand James, chief market strategist, Geojit Financial Services, said, “Sensex having 30 constituent stocks as compared to Nifty 50 having 51 stocks may have something to with the uneven movement in the two benchmark indices, but even Sensex is in touching distance from its record high of 30,024.74. The extra 21 stocks in Nifty 50 index may have contributed more leading to Nifty going past its previous highs repeatedly.”
Anupam Singhi, chief operating officer, William O’Neil India, a US based equity research firm, said, “ Both the indices in the long run are high co-related and by and large they move in tandem, the long-term chart shows. This kind of divergence can happen in the short run.”
“Also, some of the Nifty constituents movement is better than the Sensex constituent,” Singhi said.
Columnist: 
Ravi Ranjan Prasad