Stock market today
: India’s Nifty 50 index extended its record-breaking rally to a twelfth straight session on Friday, reaching a new all-time high along with the S&P BSE Sensex, driven by expectations of an impending interest rate cut in the United States.
The Nifty 50, which debuted in April 1996, advanced 0.33% to close at 25,235.9, while the Sensex gained 0.28% to end at 82,365.77.
Both indices recorded their third consecutive weekly and monthly gains, rising 1.6% for the week and approximately 1% in August, according to a Reuters report.
Positive U.S. economic indicators throughout the month and accommodative statements from Federal Reserve officials, including Chair Jerome Powell, alleviated growth worries and increased the likelihood of a September rate cut.
Analysts anticipate that this will encourage foreign investments in emerging markets, such as
Indian equities
. Foreign investors became net buyers in the latter half of the month, while domestic investors remained buyers throughout.
“Liquidity is coming in left, right and centre, while the near-certainty that the U.S. rate cut will start from September is boosting buying interest and consequently the momentum in markets further,” said Avinash Gorakshakar, head of research of Profitmart Securities. “However, the benchmarks may not gallop from here given the high valuations but certainly, the sentiment in Indian markets is as bullish as ever.”
IT and pharmaceutical sectors, which derive a significant portion of their revenue from the U.S., were the biggest beneficiaries of the anticipated U.S. rate cut, gaining 4.74% and 6.61%, respectively, in August. The more domestically oriented small- and mid-cap indices rose about 0.9% and 0.5%, respectively, for the month.
Crucial U.S. inflation data, scheduled for release later in the day, will provide insight into the probability of a September rate cut. Domestically, data, also due after the market close, is projected to show a slowdown in India’s economic growth during the April-June quarter. However, analysts believe this has already been factored in, as the period included the national elections.
