Sensex, Nifty hit record highs at open; metal stocks lead
In early deals, Sensex advanced 370 points or 0.66% to touch a new peak of 56,494 while Nifty 50 advanced 100 points or 0.60% to 16,806.
Equity benchmarks opened at record highs on Monday tracking a positive trend in global markets. In early deals, Sensex advanced 370 points or 0.66% to touch a new peak of 56,494 while Nifty 50 advanced 100 points or 0.60% to 16,806.
“The much-awaited Fed commentary after the Jackson Hole Symposium has indicated that “it would be appropriate to start reducing asset purchases this year.” But the Fed chief has hastened to add that there is much ground to cover before rate hikes. So, even though this can be treated as the beginning of normalization of the accommodative policy, the communication is smart enough not only to calm the markets but to enthuse it too. Consequently, the dollar index has slipped to below 93 and the risk-on in US markets has pushed the indices to record highs. This will enthuse the bulls in India too,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
However, it is important to temper the exuberance. FIIs are continuously selling equity. And, more importantly, now they have turned buyers in bonds, having bought bonds worth Rs 11557 cr in August. They were sellers in bonds in all the previous seven months in 2021. In August, till 29th, FPIs have bought equity worth Rs 986 cr. But if we exclude the FPI primary market purchases the net figure is selling to the tune of Rs 7184 cr. If this trend continues, it will have implications for markets, Vijayakumar added.
Gainers & losers
Top gainers & losers on the Sensex.
Sectoral strand
All sectoral indices on the NSE were in the green. Nifty Metal led the sectoral pack as it rallied the most and was trading with gains of 1.74%, followed by the Nifty Auto index advanced 0.90%. Nifty Bank, Nifty FMCG, Nifty Pharma, Nifty Realty and Nifty IT indices rose up to 0.55%.
Broader market
Strength was visible in the broader markets as both mid & small cap indices outperformed the benchmark indices. The BSE MidCap index opened higher by 196 points 0.84% at 23,451 level and the BSE SmallCap index was quoting at 26,284 up by 203 points or 0.77%.
The market breadth was positive as 1,785 shares advanced compared to 467 declined and 108 remained unchanged.
Global markets
Overseas, Asian stocks are trading higher on Monday after US Federal Reserve Chairman Jerome Powell struck a more dovish tone than some investors expected in long-awaited speech on Friday.
In other Chinese tech developments, Beijing is reportedly looking at new rules that would restrict domestic internet firms from going public in the US.
US stocks indexes closed higher Friday, with the S&P 500 and Nasdaq Composite indexes finishing at fresh peaks, following Federal Reserve Chair Jerome Powell’s remarks at the Jackson Hole central bankers’ symposium.
US Federal Reserve (Fed) Chair Jerome Powel said Friday during the Federal Reserve Bank of Kansas City’s annual Jackson Hole economic symposium that the Fed could start tapering asset purchases this year as the central bank is carefully assessing the risks from the Delta variant.
The Fed chief also cautioned that a move to start tapering asset purchases should not be interpreted as a sign that rate hikes would soon follow.
Fed Chair Powell said the US central bank “will be carefully assessing incoming data and the evolving risks,” perhaps offering himself more wiggle room before its September 21-22 meeting to digest further evidence of the health of the economy, including a coming jobs reports for August.