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sensex news: Sensex hits fresh record high: 5 key factors behind the stock market rally

Another round of optimism about a possible Fed pivot and firm global signals gave Dalal Street bulls a shot in the arm. Late night purchases in domestic markets pushed the Sensex BSE barometer to a new all-time high of 62412.33 on Thursday.

The 30-pack index, which rose nearly 900 points during the day, reached its new closing high of 62,272.68, up 762.10 points or 1.24%.

Meanwhile, its NSE counterpart, Nifty50, settled 216.85 points or 1.19% higher at 18,484.10. The index reached a new 52-week high of 18,529.70 earlier today.

Investors in Dalal Street got richer by Rs 2.46 lakh crore today as the market capitalization of all BSE-listed shares reached Rs 283.9 lakh crore.

Here are the key factors behind today’s market rally:


Delay in rate hikes by the Fed
The Federal Reserve’s latest minutes show that most policymakers expect a slower pace of interest rate hikes, even though they are unsure how high the reference rate will rise. Analysts said smaller rate hikes by the Fed are positive for both risky assets and safe haven assets like gold.

“Spearheaded by broad buying, domestic indices witnessed solid gains as investors digested the latest FOMC meeting minutes, which indicated that the cycle of rate hikes could slow,” said Vinod Nair, Head of Research at Geojit Financial Services.

Strong global markets
Earlier in Asian markets, Japan’s Nikkei 225 was up 0.95% and South Korea’s Kospi was up 0.96%, while China’s Shanghai Composite was down 0.25%. During the last trading session, US markets closed in the green. Dow Jones Industrial Average was up 1.08%, S&P 500 was up 0.59% and Nasdaq Composite was up 0.99%. US markets are closed today for Thanksgiving.

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Crude oil prices
Falling crude oil prices further boosted investor sentiment. Crude oil prices fell on talks over a possible Russian oil price cap and a rise in US product inventories, Nair said.

Brent crude oil futures fell 0.3% to $85.13. US crude oil futures fell 0.2% to $77.74/barrel. They were down more than 3% on Wednesday as the Group of Seven (G7) countries considered a price cap on Russian oil above current market levels.

Indian rupee
The Indian rupee rose from 81.8450 in the previous session to 81.63 against the US dollar amid the broad decline in the US dollar after the Federal Reserve reaffirmed expectations of a decline in the pace of interest rate hikes.

Monthly M&O Due Date
Buying was also led by short covering by traders as today was the last day of the series of derivatives expiring for the current month.

(Disclaimer: recommendations, suggestions, views and opinions of the experts are their own. They do not represent the views of Economic Times)

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