Benchmark indices hit new highs

Macro tail-winds, foreign buying helps push markets higher

The National Stock Exchange's Nifty index ended at its highest ever closing level of 8,389.90 on Friday. It was up 32.05 points or 0.38%. The BSE's Sensex closed at 28046.66. Both are all-time closing highs.

Sentiment has been positive on the back of Wholesale Price Index figures coming in at a five-year low of 1.77%, according to experts. Falling inflation is also expected to help make it easier for the Reserve Bank of India to eventually cut interest rates.

On an intra-day basis, the Nifty has previously touched an all-time high of 8415 on 12th November. The Sensex had hit an all-time high of 28126 on the same day.

Ten out of twelve sectoral indices ended with gains on Friday with profit booking in defensive sectors as investors are said to be switching to other segments which are expected to grow faster.

Indices tracking the Fast Moving Consumer Goods(FMCG) and Healthcare sectors were down 0.12% and 1.22% respectively. The S&P BSE Metal index was up 2.53%. The S&P BSE Realty index was up 2.35%.

"We continue to be positive on the market. We now have a target of 9250 on the Nifty by next Diwali," said Pankaj Pandey, head of research at ICICIDirect.

Crude oil has fallen below the $80 per barrel, which is seen as a tailwind for India as it imports around three quarters of its crude oil requirements.

HDFC Bank closed at Rs.929.3, up 1.43%. The Foreign Investment Promotion Board approved a decision to allow increased foreign holding in the company.

"The market is in a good place, and as the environment turns more benign we could see more upside'. We may see margin expansion but meaningful traction in earnings is more likely to take place in FY16," said Gopal Agrawal - Chief Investment Officer (CIO) at Mirae Asset Global Investments.

Foreign institutional investors were net buyers by Rs.645.9 crore on Friday. Domestic institutions were net sellers by Rs.517.51 crore.