Sensex, Nifty touch new highs amid global market optimism
The BSE Sensex and NSE Nifty 50 reached record-breaking highs today, driven by positive global signals and robust performance in the energy and banking sectors. The Nifty 50 hit an unprecedented peak of 25,445.70 points while the Sensex scaled a new high of 83,184.34 points. This surge is also attributed to anticipation surrounding the US Federal Reserve's upcoming monetary policy decision, where investors are hopeful for an interest rate cut.
Market experts weigh in on bullish trend
Prashanth Tapse, Senior VP (Research) at Mehta Equities, stated that investor sentiment is optimistic ahead of the Fed's September 17-18 meeting. Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, echoed this sentiment. He highlighted that global equity markets will be closely watching the Fed rate action on Wednesday as it could significantly influence stock market trends in the near term.
Sectoral indices and market leaders
Excluding Nifty FMCG, all 12 other sectoral indices posted gains. HUL, Varun Beverages, and Britannia weighed on the Nifty FMCG, pulling it down by 0.8%. Among the top laggards on Nifty 50 were Nestle, SBI Life, Hero MotoCorp, Britannia, and HUL which dropped between 0.3-2.2%. In contrast, Tata Steel led the gainers with an increase of 1-2% followed by Grasim Industries (1%), Hindalco Industries (1%), NTPC (1%), and Adani Enterprises (1%).
Broader market and Asian indices show mixed results
The broader market also experienced gains, with the BSE Midcap and Smallcap indices advancing by 0.3% and 0.5% respectively. The Nifty Midcap 100 rose by 0.5% to hit a record high of 60,408 at open. However, Asian markets presented a mixed bag this morning due to various regional factors including China and South Korea's closure for the Mid-Autumn Festival, Japan's observance of Respect for the Aged Day, and disappointing Chinese economic data over the weekend.
US indices and Fed's policy meeting in focus
In the US, the major indices closed last week on a high note, with the S&P 500 and Nasdaq Composite delivering their best weekly performance of the year. All eyes are now on the Fed's policy meeting where many anticipate the first interest rate cut since 2020. The CME FedWatch Tool indicates a 41% chance of the target rate dropping to between 5-5.25%, and a 59% chance of it falling further to between 4.75-5.00%, from the current range of 5.25-5.50%.
