Mumbai. The local stock markets witnessed a sharp rise on Monday amid expectations that the US Federal Reserve will soon start cutting interest rates. The benchmark index Sensex jumped 612 points, while the Nifty closed above 25,000 points.
Traders said foreign capital inflows and buying in key stocks like HDFC Bank and Reliance Industries also boosted the market.
The 30-share BSE index Sensex jumped 611.90 points or 0.75 percent to close at 81,698.11 points. During trading, at one point it rose 738.06 points to reach 81,824.27 points. This was the fifth consecutive session of rise in the Sensex.
The National Stock Exchange (NSE) index Nifty rose 187.45 points or 0.76 percent to reach 25,010.60 points. Nifty remained on the rise for the eighth consecutive session.
Among the Sensex companies, shares of HCL Technologies, NTPC, Bajaj Finserv, Tech Mahindra, JSW Steel, Titan, Mahindra & Mahindra, Tata Steel, Larsen & Toubro and Tata Consultancy Services closed with gains. On the other hand, shares of Kotak Mahindra Bank, IndusInd Bank, Maruti Suzuki and Hindustan Unilever declined.
In the broader market, the BSE Midcap index jumped 0.66 per cent while Smallcap gained 0.20 per cent.
Vinod Nair, Head of Research, Geojit Financial Services, said, “The Federal Reserve has indicated a cut in interest rates in September. This led to weakness in the US bond yields and the dollar index and there was a bullish environment in the global markets.” Nair said that the Indian market was seen moving towards new heights due to a change in the attitude of foreign institutional investors (FIIs). There was enthusiasm especially for the shares of big companies.
The statement of the Chairman of the US Central Bank Federal Reserve, Jerome Powell, on Friday strengthened the bullish sentiment in the market. Powell had said that the time has come to bring down the policy interest rate from the two-decade high. In other Asian markets, China’s Shanghai Composite and Hong Kong’s Hang Seng remained on the rise, while South Korea’s Kospi and Japan’s Nikkei declined. Most of the European markets were trading in losses. The US markets closed with a significant gain on Friday.
Ajit Mishra, Senior Vice President (Research) at Religare Broking Ltd, said, “The markets started the trading week on a positive note and closed more than half a percent higher. It got a boost from the expectation of a change in the policy stance of the US Federal Reserve.” According to stock market data, foreign institutional investors (FIIs) made net purchases of shares worth Rs 1,944.48 crore on Friday. Global oil benchmark Brent crude rose 1.08 percent to $ 79.87 per barrel. The BSE Sensex closed 33.02 points higher at 81,086.21 points and the NSE Nifty closed 11.65 points higher at 24,823.15 points on Friday.