Key benchmark stock indices on Thursday surged 1.6% to all-time closing and intraday highs after a buying momentum in auto and banking stocks owing to the RBI’s decision on Wednesday to transfer ₹2.11 lakh crore as surplus to the Centre.
| Photo Credit: PTI
Key benchmark stock indices on Thursday surged 1.6% to all-time closing and intraday highs after a buying momentum in auto and banking stocks owing to the RBI’s decision on Wednesday to transfer ₹2.11 lakh crore as surplus to the Centre.
The S&P BSE Sensex gained 1,196.98 points, or 1.61%, to 75,418.04, its all-time closing high. During intraday, the Sensex had scaled to an all-time high mark of 75,499.91.
Top gainers in Sensex included L&T (3.64%), M&M (3.55%), Axis Bank (3.30%), Maruti (2.82%), UltraTech Cement (2.74%) and IndusInd Bank (2.29%).
The NSE Nifty-50 index, too, surged 369.85 points, or 1.64%, to 22,967.65, its all-time closing high. During intraday the Nifty-50 index touched an all-time high of 22,993.60.
“There was enthusiasm in the equity market after the RBI approved a ₹2.11 lakh crore dividend to the government. This indicates a better fiscal position and softer bond yields going forward,” said Neeraj Chadawar, Head – Fundamental and Quantitative Research at Axis Securities.
“As a result of this positive move, we are seeing some short covering in the market. If the election outcome aligns with current market expectations, we expect the indices to reach new highs in the first week of June,” he said.
Sarvjeet Singh Virk, co-founder & MD, Shoonya by Finvasia, said, “The Nifty hitting an all time high of 22,900 and Sensex reclaiming 75,000 is a highly optimistic sign. This can be majorly attributed to RBI’s ₹2.11 lakh crore dividend to the government, allowing for an additional 0.3% of GDP fiscal room for the government.”
“This in turn, will allow the government to reduce its fiscal deficit and increase infrastructure spending. This is a major macro factor boosting investor confidence. This bodes well for the medium to long-term horizon,” he added.
Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C. Mehta Investment Interrmediates Ltd. said, on Thursday, significant buying activity was observed in the banking, finance, auto, and IT sectors.
“Technically, the Nifty-50 index has crossed the barrier of 22,800 and managed to sustain above it, suggesting strength. Thus, as long as the index holds 22,800, we expect the rally to extend towards 23,100-23,200,” he added.
