Continuing its winning streak for the eighth day, the Sensex on Thursday surged about 468.6 points to cross the 63,500 level at its fresh all-time high of 63,563.18 points in the early morning opening trade. The Nifty also posted a jump of 103.20 points to 18,861.55, its lifetime high level. The rupee on Thursday also strengthened by 28 paise to 81.02 to a dollar in early morning trade, compared with the previous close of 81.30.
The domestic equity markets have been closing in positive territory for the past seven days and Thursday is the eighth day.
Among the Sensex constituents, 25 out of 30 companies were in the green. Tech Mahindra, Wipro, Infosys, TCS and HCL Tech were the top gainers on the BSE Sensex. On the other hand, PowerGrid, Hindustan Unilever, Asian Paint, M&M and Maruti were the lop losers.
V K Vijayakumar, chief investment strategist at Geojit Financial Services, said, “US Fed chief Powell’s observation that ‘it makes sense to moderate the pace of rate hikes’ has come as a shot in the arm for the bulls to take the ongoing rally forward. The dip in the dollar index to 105.5 and the US 10-year bond yield declining sharply to 3.63 per cent are hugely favourable for the continuation of FII inflows. In brief, the market construct is favourable for the continuation of the rally.”
He added that for the near term, concerns of elevated valuations are likely to be ignored by the market. However, investors should be cautious while chasing this rally. Even though Sensex and Nifty are at record highs, the MidCap and SmallCap indices are 2 per cent and 17 per cent away, respectively, from their peaks.
“Therefore, retail investors may chase this rally driven by the FOMO factor. That would be risky since mid- and small-caps will correct sharply during a market pullback, which can happen since valuations are high. Safety is in high quality large caps,” he said.
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