Market at new high! Sensex crosses 75K; Nifty hits 22,700

The euphoria in the equity market is far from over as the benchmarks BSE Sensex and NSE Nifty achieved another milestone on Tuesday. The Sensex and Nifty50 scaled their new lifetime highs of 75,124 and 22,765, respectively, on the back of broad-based gains across sectors as well as positive cues from global peers. Driven by the sustained rally for the last four sessions, the combined market capitalisation (mcap) of all BSE-listed companies crossed over ₹400 lakh crore, adding more than ₹100 lakh crore in the past nine months amid growing optimism about the robustness of the Indian economy.

Extending gaining momentum on Tuesday, the BSE benchmark Sensex rose as much as 382 points, or 0.51%, to hit a new record high of 75,124 in the opening trade. In a similar trend, the NSE Nifty climbed 102 points, or 0.45% to acclaim a new life-time high of 22,768 in the early trade. The Sensex has gained 1,247 points in the last four sessions and the Nifty added 333 points during the same period.

The 30-share Sensex has surged over 18,000 points in the last one year from its lowest level of 57,000 touched in March 2023, in the aftermath of the Adani-Hindenburg row. In the calendar year 2024, the BSE benchmark added more than 2,800 points, while it climbed over 9,500 points in the past six months.

The positive macro indicators such as rise in GDP growth, dip in inflation, as well as sustained buying by foreign institutional investors (FIIs) and domestic institutional investors (DIIs) supported the market rally. The interest rate cuts by the central banks around the world also boosted investors’ appetite for equities.

"The hallmark of a bull market is its ability to set new record highs. This has been happening in the mother market U.S. and also in the Indian market. An important feature of the recent rally in India is that it is led by fundamentally strong sectors like capital goods, automobiles, banking, and metals,” says V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

According to Vijayakumar, the robustness of the Indian economy, sustained capital flows into mutual funds, and the enthusiasm of domestic investors can support the rally. “However, valuations of the Smallcap segment are elevated and unjustified," he adds.

The market witnessed broad-based buying today, barring FMCG and auto space, led by metal and information technology sectors. The BSE metal index rose as much as 1.4%, with index heavyweights Tata Steel, Hindalco Industries, SAIL, Vedanta, and JSW Steel, rising in the range of 1-5%.

In a similar trend, the BSE IT index climbed over 1%, led by sectoral leaders such as Infosys, HCL Technologies, TCS, Wipro, and others.

According to Santosh Meena, Head of Research at Swastika Investmart, several factors contributed to this market rally. “Central banks around the world implemented interest rate cuts, while governments enacted fiscal stimulus packages to bolster their economies during the COVID-19 crisis. This strategy proved effective, leading to a robust economic recovery in India. Currently, India boasts the fastest-growing economy globally, with a promising future fueled by political stability.”  

“We appear to be in the midst of a major bull market, which is likely to persist for the next few years. The Sensex reaching 100,000 seems like a realistic possibility in the near future. However, investors should prioritise quality stocks while maintaining a long-term investment approach,” Meena adds.

ICICI Direct in its technical outlook report says Nifty to head towards 23,400 by the general election outcome while short term milestone is placed at 22,900 in coming weeks. “Thus, any temporary breather should be capitalised as incremental buying opportunity as strong support is placed at 22,100.”

“The current up move is backed by broad based participation as Percentage of stocks above 50days exponential moving average (EMA) rebounded strongly from its bearish extreme (20% levels) to current reading of 70%,” the report notes.

The Nifty index is showing resilience despite global volatility signaling pre-election rally is brewing up in tandem with historical election year price-behaviour, ICICI Direct says in its report.

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