Sensex, Nifty close at fresh record highs; metal stocks lead

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After a tepid opening, equity benchmarks scaled fresh lifetime highs on Monday led by gains in metal and FMCG stocks. Sensex closed the session 145.29 points or 0.26% higher at record 55,582.58. The 30-share BSE index touched a record intra-day high of 55,680.75. Likewise Nifty settled at 16,563.05, up 33.95 points or 0.21%. During the day, the 50-share index hit a fresh high of 16,589.40.

“During the afternoon session, markets turned positive as buying in Energy, Oil & Gas and Metal sectors lifted the indices. Sentiments were upbeat as India’s annual wholesale price inflation eased to 11.16% in July from the previous month’s 12.07%, helped by lower increases in the cost of fuel and food items. Additional support also came with ICRA Ratings’ report stating that most states are likely to be in better fiscal health this financial year as 20 of them are collectively carrying forward Rs 2.6 lakh crore borrowed in FY21 to this fiscal,” said Narendra Solanki, Head- Equity Research (Fundamental), Anand Rathi Shares & Stock Brokers.

Gainers & losers

Sectoral strand

Most sectoral indices on the NSE closed in the red. Nifty Auto slipped 0.88%, Nifty Pharma lost about 0.60%. Nifty IT, Nifty Realty and Nifty Bank indices  fell up to 0.40%.

On the other hand, Nifty Metal, closing about 1.5% higher, was the top sectoral gainer followed by Nifty FMCG index, up 0.30%.

Broader market

Despite benchmark indices scaling new highs some pain was visible in the broader markets. The BSE MidCap index ended at 22,900 level slipping 0.18%. Correction in small caps was much deeper as the BSE SmallCap index fell 0.57% to settle at 26,183.

The market breadth was negative as 2,127 shares declined, while 1,116 advanced and 138 remained unchanged.

Global markets

European stocks declined across the board while most Asian stocks declined on Monday, 16 August 2021, as the delta virus strain hampers economic reopening and as investors reacted to the release of economic data. South Korea’s markets are closed on Monday for a holiday.

Market participants closely monitored the potential geopolitical implications of the sudden collapse of the Afghanistan government. Taliban insurgents over the weekend pushed their frontlines into the capital city of Kabul after a succession of shocking battlefield reversals, spurred by the exodus of U.S. and coalition forces.

In Asia, retail sales in China rose 8.5% in July as compared with a year ago, according to official data released Monday. Meanwhile, industrial production grew 6.4% in July.

Japan’s GDP rose 0.3% in the second quarter as compared with the previous three months, when it contracted 0.9%, according to official preliminary estimates released Monday.

In US, the Dow Industrial and S&P 500 edged up to closing records on Friday, buoyed by a climb in Walt Disney shares, but a sharp drop in consumer sentiment kept gains in check.

The University of Michigan’s sentiment read for August printed at just 70.2, the weakest since December 2011.