Stocks rebounded on Friday after slithering downwards for five continuous sessions, a sign the bulls are taking fresh positions to strike back after being pummelled by bears soon after the budget was presented on Tuesday.

Led by IT and metal stocks, the 30-share BSE Sensex vaulted 1292.92 points to end at 81332.72.

During intra-day trades, it jumped 1,387.38 points to 81427.18.

On the NSE, records were broken as the broader Nifty surged 428.75 points to finish at an all-time closing high of 24834.85.

The markets reversed gear after data showed the US economy grew faster than expected in the second quarter (April-June) of 2024 — a positive for technology companies such as Infosys and Tata Consultancy Services (TCS) which derive a large part of their revenues from the US.

Tech stocks have earlier received a boost from expected cuts in interest rates by the US Federal Reserve from September. The budget proposals on capital gains tax has hit investors hard. The Economic Survey, released a day earlier, had forewarned them of possible tough measures in the budget.

The Survey bemoaned a casino-like mentality in the markets with investors pulling money out of fixed deposits (FDs) and chasing dreams of sky-high returns in stocks.

“The surge was fuelled by improved sentiment following robust performances in IT and metal stocks, as well as significant rollovers to the August series. Broader indices also reflected this strength, showing substantial gains,” Ajit Mishra – SVP, Research, Religare Broking said.

Brokerage Nuvama Institutional Equities has said market-wide futures open interest — the number of contracts that are outstanding in the market — at the beginning of the August series is nearly at ₹4.51 trillion an historic high against ₹4.32 trillion at the start of the July series.

Meanwhile, the rupee closed at a record low against the dollar at 83.72 after touching a day’s low of 83.73 against the greenback. It had closed at 83.70 on Thursday.

The pressure on the domestic currency came on account of dollar demand from oil companies, even as the rally in the stock markets averted any further fall.

Jateen Trivedi of LKP Securities said expectation of an interest rate cut by the Fed in the September policy could add pressure on the dollar, especially if hints are given at the July-end policy.

“The rupee is expected to continue its sideways range between 83.60 and 83.80,” he noted.