Sensex and Nifty Reach New Heights While Responding to US Fed Signals

Sensex and Nifty Achieve Record Levels

Equities have experienced significant gains, with benchmark indices Nifty surpassing 26,000 points and Sensex closing at 85,000 during intra-day trading. The ongoing optimism over the US Fed’s aggressive interest rate cuts and China’s stimulus package have propelled market momentum.

US Fed and RBI Impact on Market

Market participants attribute this rally to the US Fed’s recent 50-basis point rate cut and expectations of further cuts from the RBI during the upcoming Monetary Policy Committee meeting. However, valuation concerns were noted as indices pared gains amid geopolitical tensions in West Asia.

• The Nifty closed at 25,940.40 points.
• The Sensex ended at 84,914.04 points.
• Investor wealth rose to Rs 476.08 trillion.

Expert Insights on Market Conditions

Naveen Kulkarni from Axis Securities remarked, “Indian equities appear expensive in comparison to emerging markets, but the long-term growth potential remains strong.” Furthermore, Sorbh Gupta from Bajaj Finserv AMC noted the presence of froth in the broader market but highlighted pockets of value in large-cap stocks.

Key Takeaways from the Market Rally

While geopolitical challenges linger, inflation is reported to be stable with crude oil prices remaining steady. The recent climb from 25,000 to 26,000 points took 37 days, indicating a cautious yet ongoing bullish momentum in Indian indices.

Market Performance Metrics

• Bajaj Auto, Shriram Finance, and Bharti Airtel are key contributors to the Nifty's ascension.
• In 2024, the Sensex has climbed nearly 18% while midcap and smallcap indices have surged around 34%.