The markets moved into a higher orbit on Friday as the BSE Sensex breached the 84000-mark for the first time and investor wealth zoomed ₹6.24 lakh crore — catapulted by the 50-basis point rate cut by the US Federal Reserve and the diminishing number of jobless in the US which dispelled fears of a weak economy.

Foreign portfolio investors (FPIs) were at the forefront on Friday. Provisional data from the stock exchanges showed them making net purchases to the tune of ₹14,064 crore.

The FPIs have been net purchasers since June and the sharp Fed cut seems to have only intensified their interest in India.

The 30-share BSE gauge rallied 1359.51 points or 1.63 per cent to end at a record peak of 84544.31 after jumping 1509.66 points to hit an intra-day high of 84694.46.

At the NSE, the bullish sentiment saw the broader Nifty soaring 375.15 points or 1.48 per cent to close at a record 25790.95.

Analysts said the run-up in stocks came due to easing worries over the health of the US economy.

Data released by its Labor Department on Thursday showed applications for unemployment benefits declining 12,000 to 219,000 in the week ended September 14, the lowest level in four months.

``The market gained momentum with a surprise 50 basis points rate cut by the US Fed. The apprehension of a slowdown in growth was eased slightly after the lower-than-expected US jobless claim. The data pointed to a soft landing of the US economy at the start of the rate cut cycle,’’ Vinod Nair, head of research, Geojit Financial Services, said.

``The markets are gradually climbing up and we expect this positive momentum to continue next week backed by strong FII inflow, healthy domestic macros, and receding concern about the US economy slowing down,’’ Siddhartha Khemka, head — research, wealth management, Motilal Oswal Financial Services added.

Food price alert

Food price volatility remains a contingent risk even as the overall retail inflation has remained below the target of 4 per cent for the second consecutive month in August, said the latest bulletin of the Reserve Bank released on Friday.

An article in the September Bulletin further said that household consumption is poised to grow faster in the second quarter as headline inflation eases, with a revival of rural demand already taking hold.

"Consumer price index (CPI) inflation came in below the Reserve Bank's target for the second consecutive month in August, although in light of the recent experience, food price volatility remains a contingent risk," said the article on the state of the economy.

It further said global economic activity is slowing down, while the pace of disinflation remains sluggish, provoking caution among monetary policy authorities.