The record-setting spree of the Indian market continued on November 28 even though global cues remained weak due to concerns over the protests in China against Covid-led restrictions.
A sharp fall in crude oil prices seems to have underpinned sentiment at the domestic market even as globally, investors are concerned that China's zero-Covid curbs will seriously affect the world's second-largest economy.
When the US and Europe are staring at a looming recession, any bad news on the front of global economic growth is certain to impact the market's mood.
Crude oil prices suffered strong losses on demand concerns amid China protests. Brent Crude fell more than 3% and traded near the $81 per barrel mark.
The rupee inched up 2 paise to settle at 81.67 as the dollar gained ground amid a selloff in equity markets.
Equity benchmarks the Sensex and the Nifty scaled their fresh all-time highs of 62,701.4 and 18,614.25, respectively in intraday trade. They settled at their fresh closing peaks and extended their winning streak for the fifth consecutive session.
Sensex closed with a gain of 211 points, or 0.34%, at 62,504.80. The Nifty50 settled at 18,562.75, up 50 points, or 0.27%. Mid and smallcaps outperformed the benchmarks. The BSE Midcap index rose 0.72% while the Smallcap index logged a gain of 0.77%.
The overall market capitalisation of BSE-listed firms rose to ₹285.9 lakh crore from ₹284.6 lakh crore in the previous session, making investors richer by ₹1.3 lakh crore in a single day.
As many as 164 stocks, including ICICI Bank, Cummins India, IDFC First Bank, Escorts Kubota, Exide Industries, South Indian Bank and SJVN, hit their 52-week highs in intraday trade on BSE.
"Despite unfavourable global cues, the domestic market reversed its early losses to trade at record highs. Following the decline in oil prices, oil & gas stocks led the rally in anticipation of margin gains, as ongoing protests in China fuelled demand concerns," said Vinod Nair, Head of Research at Geojit Financial Services.
Reliance Industries, Nestle and Asian Paints ended as the top gainer stocks while Tata Steel, HDFC Bank and Bharti Airtel ended as the top laggard stocks in the Sensex index.
Among the sectoral indices, Nifty Bank ended almost flat at 43,020.45. The Nifty Oil & Gas index rose 1.60% while the Nifty Metal index bucked the trend and fell 1.14%.
Most factors are already on the table for the market. Some analysts advise staggered incremental allocations to equities at this juncture.
"Sentiment and flows currently are acting as a strong catalyst for the markets. We are seeing domestic as also foreign investors being net buyers of equity aiding the momentum. From here, one needs to be balanced as most of the positives are in the prices for now. Incremental allocations to equities could be done in a staggered manner as opposed to lumpsum investments," said Lakshmi Iyer, CEO- Investment Advisory, Kotak Investment Advisors said.
Srikanth Subramanian, CEO, Kotak Cherry said, “Indian markets are defying global weakness and touching all-time high. This is on the back of renewed interest from FIIs as the Indian decoupling story continues to play out. However, one must also realize that as we continue to see better growth rates than the world, our valuations, too, are priced at those premiums. Even long-term investors at this point should not betray discipline. One should ideally avoid any extreme movements and stick to the core asset allocation that one has defined for oneself."
Technical views by experts
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities observed that the higher bottom formation on intraday charts indicates an uptrend in the near future.
"For the trend following traders, now 18,400-18,350/62,200-62,000 would be the sacrosanct support zones. Above these levels, the index may hit a fresh all-time high or 18,605-18,650/62,750-63,000. Below 18,350/62,000, the uptrend would be vulnerable” said Chouhan.
Om Mehra, Technical Associate at Choice Broking pointed out that the Nifty formed a bullish candlestick pattern on the daily chart.
"The market breadth is skewed in the favour of bulls. RSI is still holding the 70 level, confirming the momentum. Open interest (OI) data shows maximum Call OI is at 18,700, followed by 18,800 strike prices while on the put side, the highest OI was at 18,400, followed by 18,300 strike price. We suggest riding the positive rally for the next couple of days. The high futures premium is indicative of the underlying bullishness in the market. Going ahead, too, we expect the momentum to remain strong," said Mehra.
Key market data
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of MintGenie.