Markets start new fiscal year on a winning note, hit fresh highs

Except auto, FMCG, all sectors in green; Nifty mid/smallcap indices up

Equity markets started the new financial year on a strong note, hitting fresh highs, on positive global cues.

The Sensex ended with a gain of 363 points, or 0.49 per cent, at 74,014. The Nifty rose to 22,462, up 0.6 per cent.

The broader markets outperformed with Nifty Midcap100 and Nifty Smallcap100 rallying 1.7 per cent and 3.3 per cent, respectively. Barring auto and FMCG, all the sectors ended with gains, with realty, media and metals surging over 4 per cent each.

CHINA DATA EFFECT

Metal stocks rose after economic data from China indicated that the manufacturing sector is seeing a rebound, which may lead to a rise in demand for metals. Realty stocks rallied with housing demand seeing robust growth in the first quarter of this year with unsold inventories falling to 7 per cent. Auto stocks saw subdued interest post mixed set of monthly sales numbers.

GAINERS, LOSERS

JSW Steel was the top Nifty stock gaining over 5 per cent, followed by Tata Steel (4.7 per cent), Divis Labs (3.6 per cent) and Shriram Finance (3.1 per cent). Eicher Motors and Titan Company were the top losers, down 1.8 per cent and 1.7 per cent, respectively.

FPIs sold shares worth ₹522 crore on Monday, while DIIs bought for ₹1,208 crore.

“Global sentiments got a boost led by lowerthanexpected US PCE data and robust US GDP numbers, which strengthened the hopes of a rate cut. The market is expected to continue its positive momentum but the journey could be volatile on the back of elections and Q4 earnings this month,” said Siddhartha Khemka, Head, Retail Research, Motilal Oswal Financial Services.

ALL EYES ON FED, RBI

Going ahead, the RBI’s Monetary Policy, and PMI data, as also the US nonfarm payroll numbers will set the direction of the market. While the RBI’s Monetary Policy, due this Friday, is expected to maintain status quo, the central bank’s commentary will be keenly watched.

Vinod Nair, Head of Research, Geojit Financial Services, said the momentum may continue in the near term, supported by a global rally in expectation of a Fed rate cut in June and a healthy domestic earnings growth forecast in Q4FY24.