The Sensex on Thursday scaled past the 59000-mark, buoyed by the steps announced by the government to help the telecom and the auto sectors even as banking stocks rallied ahead of a Rs 30,000-crore guarantee for the bad bank.
It has taken eight sessions for the benchmark index to move from the 58000 to 59000 whereas the previous 1000 point rally came only in three days. Market circles are of the view that the 30-share gauge may breach the 60000-level before Diwali amid strong portfolio inflows and if the third wave is not be as bad as feared.
However, few experts are of the view that stocks may see some correction as valuation have reached expensive levels.
“The PLI for the auto sector, greater clarity on telecom dues with the moratorium announcement and the likely announcement of guarantees for the bad bank were the factors that helped the markets rise higher. This was again supported by the muted third wave of the pandemic so far, and the aggressive vaccination programme by the government,” said Joseph Thomas, head of research, Emkay Wealth Management.
He added that there was also comfort from moderation in inflation during August from the higher levels registered in the last couple of months. This could see the RBI persisting with its accommodative stance for a longer time.
The 30-share index opened on a positive note at 58881.04 and surpassed 59000 post noon trade. After touching an intra-day record of 59204.29, it ended with gains of 417.96 points, or 0.71 per cent, to close at 59141.16.
Similarly, the broader NSE Nifty surged 110.05 points, or 0.63 per cent, to its new closing high of 17629.50 after scaling an all-time peak of 17644.60 during intra-day trade.
IndusInd Bank was the top gainer in the Sensex pack, rising over 7 per cent. It was followed by ITC, SBI, Reliance Industries and Kotak Bank.