Markets Scale Fresh Lifetime Highs, Nifty Nears 21,000-Level

Equity benchmarks Sensex and Nifty rallied for the seventh straight session to hit fresh lifetime highs today, driven by gains in index majors Reliance Industries, ITC and L&T amid persistent foreign fund inflows.

Besides, receding crude oil prices in international markets also boosted sentiment, traders said.

The 30-share BSE Sensex surged 357.59 points, or 0.52 per cent, to settle at a new record of 69,653.73. The barometer rose to 69,744.62 during intra-day.

The broader index Nifty also climbed 82.60 points, or 0.40 per cent, to hit its fresh peak of 20,937.70.

"Post-state elections, market optimism thrives, confirming policy continuity and meeting investor expectations. A robust FII reversal is fuelled by receding inflation and dropping yields in US and Indian markets. The allure of Indian market gains post-China credit rating downgrade and decline in oil prices was followed by ease in geopolitical tensions," said Vinod Nair, Head of Research at Geojit Financial Services.

As many as 20 shares of the BSE benchmark index closed the session with gains, while 30 stocks in the Nifty ended in positive territory.

Among major Sensex movers, Wipro closed with the maximum gain of 3.85 per cent, followed by ITC -- 2.51 per cent higher. L&T and TCS gained 2.31 per cent and 2.13 per cent, respectively. Tata Motors, Nestle India, Infosys and Bajaj Finance were other gainers.

On the other hand, NTPC, Axis Bank, UltraTech Cement and ICICI Bank ended the session with a loss of up to 1.58 per cent.

In the broader market, the BSE largecap index rose 0.61 per cent, the midcap gauge gained 0.19 per cent, and smallcap advanced by 0.18 per cent.

"A strong rebound in IT, driven by reduced US recession risks and in anticipation of robust summer demand, fuels the momentum in the power sector," Nair said.

However, he cautioned that short-term profit booking may occur due to domestic premium valuation concerns.

"Further, lingering El Nino risks, a drop in reservoir levels, and reduced sowing may hold RBI to profoundly upgrade H2 FY24 growth and reduce future inflation estimates." Among sectoral indices, utilities surged 3 per cent, followed by power (2.41 per cent). While oil & gas jumped 1.96 per cent, the IT index went up 1.48 per cent, capital goods advanced by 1.25 per cent, and teck rose by 1.18 per cent.

In contrast, healthcare declined by 0.64 per cent, telecommunications slipped 0.58 per cent and bankex fell 0.50 per cent.

Analysts said the sustained equity buying by foreign institutional investors was attributed to declining US bond yields, while the domestic players were betting big on favourable macroeconomic data and expectations of longer political stability in the country.

Besides, investors are also expecting the Reserve Bank to maintain the status quo on the interest rate in its bi-monthly monetary policy decision to be announced on Friday, they added.

Foreign institutional investors purchased shares worth Rs 5,223.51 crore on Tuesday, according to exchange data.

Meanwhile, in Asian markets, Hang Seng and Nikkei 225 finished with gains of 0.90 per cent and 2.04 per cent, respectively, while China's Shanghai Composite lost 0.11 per cent.

European markets were broadly higher, led by France's CAC 40, rising 1.08 per cent. London's FTSE 100 gained 0.29 per cent, and Germany's DAX was 0.7 per cent higher.

The US markets ended on a mixed note on Tuesday, with the S&P 500 registering a marginal loss of 0.06 per cent.

On Wednesday, global oil benchmark Brent crude was trading 0.31 per cent lower to USD 76.96 a barrel.

"The bearish formation around the crucial resistance of 21,000 (Nifty) amplifies the bearish sentiment. The support lies at 20,850, below which the market may witness a healthy correction in the short term. On the other hand, a move above 21,000 might trigger a resumption of the bullish trend," Rupak De, Senior Technical analyst at LKP Securities, said.

On Tuesday, the 30-share BSE Sensex jumped 431.02 points, or 0.63 per cent, to close at a record high of 69,296.14. Nifty also climbed 168.50 points, or 0.81 per cent to hit its lifetime peak of 20,855.30.
 

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