Sensex and Nifty Reach New Highs
Indian stock indices continued to rise, with Sensex closing above 85,000 and Nifty above 26,000 for the first time on Wednesday. Sensex closed at 85,169.87 points, up 255.83 points or 0.30%, while Nifty closed at 26,004.15 points, up 63.75 points or 0.25%.
Key Drivers
The US Federal Reserve’s decision to cut interest rates by 50 basis points has supported Indian stocks. Lower interest rates in the US lead to increased capital flow to markets with higher rates, like India. Foreign portfolio investors (FPIs) have also increased their investments, buying Rs 50,913 worth of stocks in September.
Expert Insights
Ajit Mishra, SVP of Research at Religare Broking Ltd., said, “We maintain our bullish outlook amid ongoing consolidation and recommend focusing on stock selection aligned with sectoral trends. Besides rate-sensitive sectors, we observe strong momentum in metal and power stocks, while the current correction in IT presents a buying opportunity.”
Vinod Nair, Head of Research at Geojit Financial Services, added, “The domestic market may face short-term challenges owing to a decline in FIIs inflow and shift of funds to other emerging markets due to their cheap valuation.”
Market Performance
In 2024, Sensex and Nifty have risen by 17-20%. Factors such as firm growth, manageable inflation, political stability, and signs that the central bank is done tightening its monetary policy have contributed to this positive trend.
Doubts Revealed
Sensex -: Sensex is a short form for the Bombay Stock Exchange Sensitive Index. It is a number that shows how well the top 30 companies listed on the Bombay Stock Exchange are doing.
Nifty -: Nifty is a short form for the National Stock Exchange Fifty. It is a number that shows how well the top 50 companies listed on the National Stock Exchange are doing.
US Federal Reserve -: The US Federal Reserve is like the central bank of the United States. It helps control the money supply and interest rates to keep the economy stable.
Interest rate cuts -: Interest rate cuts mean that the central bank has lowered the cost of borrowing money. This can help businesses and people take loans more easily, which can boost the economy.
Foreign portfolio investors -: Foreign portfolio investors are people or companies from other countries who invest money in Indian stocks and bonds. Their investments can help the Indian stock market grow.
Ajit Mishra -: Ajit Mishra is a financial expert who works at Religare Broking Ltd., a company that helps people buy and sell stocks.
Vinod Nair -: Vinod Nair is a financial expert who works at Geojit Financial Services, a company that provides advice and services for investing in the stock market.
Religare Broking Ltd. -: Religare Broking Ltd. is a company in India that helps people buy and sell stocks and other financial products.
Geojit Financial Services -: Geojit Financial Services is a company in India that offers advice and services for investing in the stock market.
Metal and power stocks -: Metal and power stocks are shares of companies that work in the metal industry (like steel and aluminum) and the power industry (like electricity and energy).
