Indian stocks resume record-breaking rally on rate cut optimism

FE Team | Published: December 27, 2023 22:26:32

BENGALURU, Dec 27 (Reuters): India's benchmark indexes resumed their record-breaking run on Wednesday, boosted by a global rally on renewed optimism that the US central bank would start cutting rates by as soon as next March.
The blue-chip NSE Nifty 50 and the S&P BSE Sensex both hit all-time highs in the session, before they settled 1 per cent higher at 21,654.75 points and 0.98 per cent higher at 72,038.43 points, respectively.
The Nifty has hit record highs in 12 of the 18 sessions so far in December. The last time was on Dec. 20, which sparked some profit-booking and led to a three-session lull before the latest jump.
Even the more domestically focused mid-caps rose 0.38 per cent, while small-caps gained 0.45 per cent on the day, also helped by domestic current account data as well as data showing manufacturing activity in top consumer China improved last month.
"The sentiment is positive and could continue for the remaining few days of the week as, generally, December is a strong month for the markets," said Apurva Sheth, head of market perspective and research at Samco Securities.
Eleven of the 13 major sectoral indexes gained, with the metals index rising 1.4 per cent.
Aluminium producer Hindalco and cement maker Ultratech Cement were top percentage gainers on the Nifty, advancing 4.4 per cent and 4.2 per cent respectively.
The central bank said on Tuesday that the country's current account deficit narrowed in the July-September quarter as merchandise trade deficit was lower and services exports grew.
"The narrowing of current account deficit bodes well for the economy, suggesting that economic growth is on the right track," said Anita Gandhi, founder and head at Arihant Capital Markets.
Among individual stocks, Happy Forgings settled 21.3 per cent higher in its trading debut.
Coromandel International fell 1.6 per cent after an ammonia leak from its pipeline resulted in at least 44 people being hospitalised.