Healthy macro-economic data, as well as hopes of a faster economic revival, lifted India’s key equity market indices’ on Friday.
Initially, the two key equity indices had a gap up opening and continued to move higher, however, a late session bout of profit booking capped gains.
Accordingly, the S&P BSE Sensex breached the 55,487.79 points mark, while NSE Nifty50 reached 16,543.60 points.
Globally, Asian stock markets traded mostly lower as traders remained concerned over the recent regulatory crackdown in China and the alarming spread of the highly contagious coronavirus variants in the region.
However, European stocks scaled new highs hitting a record high for the tenth straight session and were on track for their fourth consecutive week of gains on optimism over a strong earnings season and steady recovery from the pandemic-led economic downturn.
On the domestic front, Capital Goods, Telecom and IT sectors rose the most, while Realty and Healthcare fell.
Consequently, the S&P BSE Sensex closed the day’s trade at 55,437.29, higher by 593.31 points or 1.08 per cent from its previous close.
The NSE Nifty50 ended the session at 16,529.10, higher by 164.70 points or 1.01 per cent from its previous close.
“Encouraging data points overnight helped as did the hopes of an early relaxations of the balance Covid curbs,” Deepak Jasani, Head of Retail Research, HDFC Securities.
“Late profit-taking led to advance decline ratio turning negative from positive early in the day. The broader indices underperformed the larger peers with both the S&P BSE MidCap and S&P BSE SmallCap almost unchanged.”
According to Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services: “On domestic front, CPI-based retail inflation came in at a three-month low of 5.6 per cent YoY in July 2021, as against 6.7 per cent YoY in July 2020. With July 2021 inflation data, CPI-based inflation is likely to average around 5.5 per cent in FY22, moderately lower than 5.7 per cent YoY forecast by the RBI.”
“This would be within RBI’s comfort zone and hence more likely that RBI would maintain its monetary policy stance in the near term as well.”