Rising for the second straight session, benchmark indices continued scaling record highs and closed 1% higher each on Monday, with Sensex topping 49,000 mark for the first time and Nifty nearing 15K mark. Tracking gains in IT stocks amid largely positive trend in global equities and massive FPI inflows, Sensex ended 486 points higher at 49,269 and Nifty gained by 137 points to 14,484.
On Friday, Sensex ended 689 points higher at 48,782 and Nifty gained 209 points to 14,347.
In today's session, Sensex and Nifty hit new lifetime highs of 49,300 and 14,498, respectively. On Sensex , Infosys, HCL Tech, ITC, HDFC Bank, Bharti Airtel, HUL and TCS were among the top gainers. On the other hand, Axis Bank, Maruti, ONGC, Bajaj Finance and Reliance Industries were among the laggards.
Except for banking, media and metal, all the other sectors closed in green territory, with over 3% rise in IT stocks, and 2.6% gain in auto scrips.S Ranganathan, Head of Research at LKP Securities said,"Buoyed by Positive global cues, Tech stocks together with Auto stocks powered the NIFTY closer to the 14500 mark. While we did see profit booking in Metals during Afternoon Trade, the sheer momentum in IT & Auto kept the Bulls in total control ahead of Q3 earnings."
Vinod Nair, Head of Research at Geojit Financial Services said, "Improved outlook for 3rd quarter earnings along with strong global cues helped Sensex to breach 49,000 mark. The rally in the market was led by the IT sector backed by firm earnings results, however, small and mid-cap stocks were under pressure. Hopes of a new US stimulus to be unveiled this week created an upbeat movement in Wall Street while profit booking is seen in the European markets. This ongoing rally is being fueled by strong Q3 earnings preview, foreign fund inflow and optimism around Union Budget 2021."
Overseas, Asian stocks were trading mostly higher on Monday, with South Korean stocks surging again, led by Auto stocks on the back of news that Hyundai and Apple are set to sign partner deal on autonomous electric cars. Markets in Japan were closed for a holiday.
US markets closed higher last week as investors looked more confident looking past political unrest and a weak economy and focused more on prospects of further fiscal stimulus. In economic data, the US economy shed jobs for the first time in eight months in December.
European markets traded higher today on the back of expectation that new US government would come out with bigger fiscal support to help the economy.
Keshav Lahoti-Associate Equity Analyst, Angel Broking said,"Nifty started the week on a positive note and closed up by 1%. Rally was led by auto stocks due to strong demand for vehicles and IT stocks due to better than expected result of TCS for Q3FY21. Nifty and Nifty IT continues its trend of making new all time high. Sectoral indices were mixed. Global cues were negative: Dow Futures, Nasdaq Futures and FTSE were down by 0.7% , 0.5% and 0.5% respectively. We are bullish on the market. Although after the sharp rally, we are concerned about the valuation of the market. We advise investors to book profit in a small portion of their portfolio."
Expressing views on Nifty's technical outlook, Rohit Singre, Senior Technical Analyst at LKP Securities said,"Index opened a day with gap and managed to hold the bullish stream for a day and closed a day near good hurdle zone of 14500 with gains of nearly one percent forming a dragonfly kind of doji candle pattern on daily chart. Going forwards index has shifted its support to 14400-14300 zone if managed to hold above said levels we may see index to march towards 14550-14600 zone which is immediate hurdle on the higher side."
Ajit Mishra, VP - Research, Religare Broking said," The anticipation of better than expected earnings season combined with supportive global cues aided the upbeat start. Going forward, stock-specific volatility would remain high as earnings season would gain pace. Further, key macro data like CPI, WPI and IIP would also be actively tracked by investors. Amid all, we reiterate our positive yet cautious stance on markets and advise aligning positions according to the prevailing trend."
On the currency front, Indian rupee, the domestic currency plunged 16 paise to end at 73.40 against US dollar, tracking weak Asian currencies and rebound in American currency.
Sugandha Sachdeva VP-Metals, Energy & Currency Research, Religare Broking said," We are witnessing a reversal in the dollar index, while political stability in the U.S. and the probability of a further fiscal stimulus package has pushed the long-term U.S. yields higher. Moreover, there is a possibility that the Fed may reduce its bond-buying plan towards the end of this year, which could further push U.S. yields higher and consequently hurt the rupee. Back home, with RBI mopping up dollar inflows, the local currency can test 73.80 to 74 levels in the coming sessions. We expect the rupee to trade in a broad range of 73 to 74.20 levels for the rest of this month."