India's benchmark indices, the Sensex and Nifty, extended their winning streak for the third consecutive day, propelled by robust gains in public sector banks and heavyweights like HDFC Bank, State Bank of India, and Reliance Industries. This surge reflects growing optimism about the government's capital expenditure plans and anticipation of favorable moves by the Reserve Bank of India's monetary policy committee later this week.
Market movers:
At the closing bell, the Sensex surged by 597.67 points, or 0.74%, to reach 80,845.75, while the Nifty climbed 181.10 points, or 0.75%, to settle at 24,457.15. Adani Ports led the gainers with a remarkable 7% surge, followed by NTPC and Adani Enterprises. On the flip side, Bharti Airtel, ITC, and Hero MotoCorp were among the top losers.
Sectoral performance:
Except for the FMCG sector, all other indices closed in the green. The Media and PSU Bank indices outperformed, rising by more than 2% each. The Nifty PSU Bank index was a star performer, with SBI gaining nearly 2%, fueled by expectations of a CRR (Cash Reserve Ratio) cut by the RBI, which could boost liquidity for banks. The Metal index also saw gains, driven by optimism around increased government infrastructure spending.
FMCG sector under pressure:
In contrast, the Nifty FMCG index declined by 0.5% amid concerns about a potential GST (Goods and Services Tax) hike on products like aerated beverages, cigarettes, and other tobacco-related items. This, coupled with a slowdown in rural and urban demand, weighed on FMCG stocks, with ITC and Varun Beverages among the major laggards.
The Indian stock market's continued upward trajectory reflects a sense of resilience and optimism among investors. While concerns remain about potential headwinds, such as rising GST rates and slowing demand in certain sectors, the overall sentiment remains positive. The strong performance of PSU banks, infrastructure-related stocks, and heavyweights like Reliance Industries suggests that investors are betting on India's long-term growth prospects. The market's response to the upcoming RBI monetary policy meeting and the government's continued focus on capital expenditure will be crucial in determining the future direction of this bull run.
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