Benchmark equity indices surged on Wednesday, with the Sensex and Nifty rising 0.95% and 0.84%, respectively, as Brent crude prices hovered around $92 per barrel, easing concerns over imported inflation, while sustained buying by foreign portfolio investors (FPIs) boosted investor sentiment.
However, profit booking at higher levels erased a significant portion of the indices’ intraday gains.
The Sensex touched an intraday high of 82,520.40, up 1.74%, in early trade before paring most of its gains to settle at an eight-month high of 81,879.40, up 772.75 points or 0.95%.
The Nifty crossed the 25,400 mark during the session, hitting an intraday high of 25,424.35, up 1.52%, before succumbing to profit booking. It eventually closed at 25,255.05, gaining 210.40 points or 0.84%.
“Markets edged higher on Wednesday, extending the prevailing positive trend and ending the session with decent gains as foreign portfolio investors continued their aggressive buying,” said Ajit Mishra, SVP – Research, Religare Broking.
Brent crude remained around $92-93 per barrel, well below its recent levels, easing concerns over imported inflation. Optimism surrounding domestic demand and corporate earnings, along with moderating global enthusiasm for AI-linked investments, further enhanced the relative attractiveness of Indian equities, Mishra added.
While the sharp rally could invite intermittent profit booking, the combination of improving earnings, lower crude prices and renewed foreign participation provides a supportive backdrop for domestic equities, said Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services.
Market breadth remained positive, with 2,909 stocks advancing against 1,595 declining on the BSE. Broader market indices also extended their gains, with the Nifty Midcap 100 and Nifty Smallcap 100 rising 0.81% and 1.59%, respectively.
Among sectoral indices, PSU banks led the gains, rising 2.94%, followed by auto, private banks, FMCG and oil and gas stocks.
Foreign portfolio investors bought shares worth Rs 12,563 crore ($1.34 billion) on Wednesday, taking their cumulative purchases in November so far to Rs 68,803 crore ($7.3 billion). This marks the highest monthly inflow in six years (since November 2020) and the second-highest monthly buying on record.
In contrast, domestic institutional investors (DIIs) sold shares worth Rs 8,434.53 crore on Wednesday, taking their cumulative net outflows in November so far to Rs 40,504 crore. This is the second-highest monthly outflow on record, after net selling of Rs 48,339 crore in November 2020.
Investors’ wealth, measured by the total market capitalisation of BSE-listed companies, increased by Rs 4.3 lakh crore to Rs 510.72 lakh crore.
Among Asian markets, Taiwan led the gains with a 3.62% rise, followed by South Korea (up 2.60%) and Japan (up 1.30%). Hong Kong (down 0.98%), Malaysia (down 0.55%) and the Philippines (down 0.40%) were among the top losers.