Benchmarks for India’s equities market finished at a record high level on Wednesday, as investors remained firmly in control after the release of the nation’s better-than-expected GDP data for the October–December quarter last week.
The NSE Nifty50 is only a few points away from reaching the 22,500 level, while the BSE Sensex closed Wednesday’s trading session over the 74,000 barrier for the first time.
The Sensex surged from the 73,000 closing line to the 74,000 level in only over 37 sessions. The previous 10,000-point milestone from 64,000 occurred in 172 sessions, or 8.3 months, but the most recent 5000-point milestone from 69,000 occurred in around 65 sessions, or 3.1 months. On Wednesday, the NSE Nifty50 gained 118 points, or 0.53%, to close at 22,474, while the BSE Sensex increased 409 points, or 0.55%, to finish at 74,086, as well.
The small- and mid-cap indices finished lower, indicating that the positive momentum was not shared by the whole market. The BSE Midcap index finished Wednesday’s session 0.65% down while the Smallcap index dropped 1.91%, after an intraday collapse of up to 3%. Experts have linked worries over premium valuation as the reason for the ongoing selling pressure in the smallcap market.
“A small tremor in the US markets last night did not deter us from our current market displays of immense strength,” said Sameet Chavan, Head of Research, Technical and Derivative at Angel One. As of right moment, we are ignoring US markets and certain global happenings, but it’s best to avoid becoming comfortable at such high levels, Chavan continued. The markets would sometimes provide some reality checks that may catch traders off guard.
Before the US Federal Reserve chair’s statement to Congress, there were conflicting signals seen by the world’s markets, according to Vinod Nair, Head of Research at Geojit Financial Services. Although it’s common knowledge that the FED chair may minimize the need for rate increases, it’s not impossible to rule out clues about a future trajectory toward rate cuts. According to recent FOMC minutes, investors believe the policy rate has peaked and that higher rates might impede growth. Nair continued.