It was yet another day of fresh records in the market.
Federal Reserve Chair Jerome Powell offered a huge relief to investors when he signalled on November 30 that the Fed was on track to reduce the pace of rate hikes.
Major markets in the US and Asia rejoiced over Fed's early Christmas gift.
Investors' risk appetite was aggravated further when reports suggested that China was getting ready to announce an easing of its Covid-19 quarantine protocols and a reduction in mass testing.
"China is set to announce in coming days an easing of its COVID-19 quarantine protocols and a reduction in mass testing, sources told Reuters, a marked shift in policy after anger over the world's toughest curbs fuelled widespread protests," reported Reuters.
Moreover, an in-line GDP print for the September quarter also bolstered investors' confidence in the Indian economy. The Indian economy grew 6.3 percent in the September quarter of FY23.
Sustained foreign capital inflow is another factor which is supporting market sentiment. As per data available with NSDL, foreign portfolio investors (FPIs) pumped in ₹36,239 crore in the Indian equities in November 2022.
Sensex and Nifty, which have been scaling fresh peaks for the last many sessions, jumped further higher on December 1.
During intraday trade, the Sensex jumped to a new peak of 63,583.07 while the Nifty registered its new all-time high of 18,887.60.
Both indices cooled off slightly but still ended at their fresh closing highs. Sensex ended at 63,284.19, up 185 points, or 0.29 percent. The Nifty closed at 18,812.50, up 54 points, or 0.29 percent. With this, the market extended its winning streak into the eighth consecutive session.
Mid and smallcaps outperformed as the BSE Midcap index rose 0.62 percent while the Smallcap index clocked a gain of 0.63 percent.
The overall market capitalisation of BSE-listed firms rose to ₹289.9 lakh crore from ₹288.5 lakh crore in the previous session, making investors richer by ₹1.4 lakh crore in a single session.
"Bulls got more reasons to celebrate, boosted by favourable macro-economic data and strong global markets. The Indian economy’s growth of 6.3% in Q2 was in line with the RBI’s forecast, while the manufacturing PMI rose to 55.7 in November. Global investors' concerns were allayed as the Fed chair adopted a dovish stance indicating slower rate hikes in the future," said Vinod Nair, Head of Research at Geojit Financial.
Shares of UltraTech Cement, Tata Steel and TCS ended as the top gainers in the Sensex index while those of ICICI Bank, Mahindra and Mahindra and Power Grid ended as the top laggards.
Among the sectoral indices, Nifty IT jumped 2.40 percent, followed by Nifty PSU Bank (up 2.11 percent), Media (up 2.08 percent) and Realty (up 1.98 percent).
As many as 156 stocks, including Larsen & Toubro, Apollo Tyres, Escorts Kubota and Britannia Industries, hit their 52-week highs in intraday trade on BSE.
"While the undertone remains bullish, the focus will now shift to next week's credit policy announcement. Most of the positive factors are still intact, but if the rate hike is above expectations, it could trigger a sharp sell-off in the near term," said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities.
Crude oil prices rose further after reports of a possible easing of Covid restrictions in China. Brent Crude traded near the $88 per barrel mark.
The rupee jumped 21 paise to end at 81.22 per dollar as the greenback witnessed some selling. Gains in the equity market and foreign capital inflow also supported the domestic currency.
Technical views by experts
The Nifty formed a small bearish candle on the daily charts indicating indecisiveness between the bulls and bears, Chouhan pointed out.
"While the larger texture of the market is bullish, we could see some profit booking at higher levels due to temporary overbought conditions. For traders, 18,700 and 18,650 could act as key support zones whereas 18,900-19,000 would be the key resistance levels," said Chouhan.
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.