Thursday saw a bullish surge in benchmark stock market indices, as both the S&P BSE Sensex and NSE Nifty50 reached all-time highs.
The Nifty50 soared to a lifetime peak of 22,959.70, gaining over 300 points, while the Sensex also hit a record high of 75,407.39 during the trading session.
By 2:40 pm, the Sensex had surged 1,021.95 points to 75,243.01, while the Nifty50 rose 321.50 points to 22,919.30. Most broader market indices joined the rally, propelled by strong performances from heavyweight stocks, contributing to a drop in volatility.
This robust market rally was largely driven by financial, banking, and information technology stocks, evident from the gains in Nifty IT, Nifty Financial Services, and Nifty Bank. Additionally, Nifty Auto witnessed a more than 1% increase, adding to the positive momentum on Dalal Street.
Among the top gainers on the Nifty50 were Adani Enterprises, Axis Bank, L&T, Adani Ports, and M&M. Conversely, Sun Pharma, Power Grid, Hindalco, Coal India, and NTPC were among the top losers.
The broader market rally followed the Reserve Bank of India’s (RBI) announcement of a record dividend payout of Rs 2.11 lakh crore to the government, surpassing earlier predictions.
This news sparked optimism, particularly in financial and banking sectors, with hopes for an improvement in the fiscal deficit.
India Today quoted Santosh Meena, Head of Research at Swastika Investmart Ltd, as saying, “The Nifty index surged to a record high following the RBI’s announcement of a substantial Rs 2.1 lakh crore dividend to the government. This is a significant macroeconomic positive, impacting the market’s fiscal deficit and bond yields directly.”
Meena further explained, “The infusion of funds acts like an indirect rate cut for the economy, potentially reducing bond yields. Given the link between many investment instruments and government bond yields, this reduction is expected to have a broad positive impact across financial markets. The improved fiscal position could also lead to upgrades in India’s economic outlook.”
He concluded, “Looking ahead, the Nifty index is poised for further growth. The immediate target of 23,000 is within reach, with the possibility of reaching 24,000 as the election outcome draws closer. However, while large-cap stocks are anticipated to perform strongly, mid-cap and small-cap stocks may lag behind from this point onward.”
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