Indian markets hit new highs on global cues, rate cut hopes 

Indian stock markets opened at record highs on Friday, buoyed by positive global cues and expectations of interest rate cuts by central banks. The Sensex opened at 83,091.55, while the Nifty started the day at 25,430.45, both surpassing their previous all-time highs.

• Also read: Nifty, Sensex to sustain positive momentum

The rally was driven by strong buying interest from foreign institutional investors (FIIs), who purchased equities worth ₹7,695 crore on Thursday, marking the second-highest single-day buying in 2024. Domestic institutional investors also contributed with purchases of ₹1,800 crore.

Global markets provided a positive backdrop, with US stocks ending higher as investors digested new inflation and labor data. The European Central Bank (ECB) cut its key deposit rate by 25 basis points to 3.5 per cent, fueling expectations of similar moves by other central banks.

“The current market trend has turned further bullish by crossing 25,350, which was the toughest task. This will help the market to cross the next psychological resistance level of 26,000,” said Shrikant Chouhan, Head of Equity Research at Kotak Securities.

Metal stocks led the gains, with JSW Steel and Tata Steel among the top performers, rising 1.58 per cent and 1.44 per cent respectively. The sector benefited from rising base metal prices on the London Metal Exchange and China’s announcement of mortgage rate cuts.

However, some sectors faced pressure. Asian Paints was the top loser, down 1.56 per cent, followed by Divi’s Lab at -1.31 per cent.

Vikas Jain, Head of Research at Reliance Securities, noted, “The global market rally, substantial FIIs purchases, and stable inflation data are expected to have a positive impact on the market. Any dips are likely to present good buying opportunities.”

Gold prices surged to a record high of $2,571 per ounce, boosting gold finance stocks. Crude oil prices also extended gains due to production disruptions in the Gulf of Mexico caused by Tropical Storm Francine.

The market’s bullish sentiment was further supported by India’s August inflation rate of 3.65 per cent, which remained below the Reserve Bank of India’s projection of 4 per cent.

As the trading day progresses, investors will be closely watching for any developments that could impact the market’s upward trajectory, particularly focusing on global central bank decisions and domestic economic indicators.