Sensex closes above 53,000 for the first time ever, adds 193 pts

Nifty 50 index rose 61 points, or 0.4 per cent, to end at a new lifetime high of 15,879.65

The benchmark Sensex on Wednesday closed above the 53,000-mark for the first time. The index of 30 blue-chip stocks ended the session at 53,054, following a gain of 193 points, or 0.37 per cent. The Nifty50 rose 61 points, or 0.4 per cent, to end at 15,879.65, a new lifetime high.

The Sensex had first closed above the 52,000-mark on February 15.

The latest 1,000-point up-move has been the slowest, compared to the earlier 10. The previous 1,000-point up-move from 51,000 to 52,000 took just five trading sessions in February amid a global risk-on rally, following the inauguration of Joe Biden as the 46th President of the United States. The Sensex’s journey from 42,000 to 43,000 had taken 205 days, as the index had plummeted below 26,000 due to the sharp sell-off triggered by the Covid outbreak in March 2020.

Experts said the markets have been sideways since February this year after a breath-taking rally following the Covid-19 lows. Expensive valuations, lack of strong positive triggers, and fears of inflation capped the upside.

Gains in metal company stocks and heavyweight banking and financials propelled the indices to new highs on Wednesday.

Tata Steel was the best-performing index stock and ended the session 4.4 per cent higher after the company announced that it was planning to increase its annual capacity in India.

Globally, Asian equities declined amid China's widening corporate crackdown and a sell-off in cyclical shares. Investors also braced for minutes from the Federal Reserve's last meeting, which can confirm a hawkish turn in US monetary policy. European stocks edged higher on Wednesday, shaking off losses on the Wall Street triggered in part by the softer-than-expected economic data.

“Amid mixed global cues and ahead of the Q1FY22 earnings data, domestic equity indices traded flattish with a positive bias towards the end of the day. Global markets traded mixed ahead of the Federal Open Market Committee minutes as investors preferred safe-haven bonds and dollars. Healthy pre-sale numbers boosted buying interest in realty stocks while metal stocks followed the trend,” said Vinod Nair, head of research, Geojit Financial Services.

Fitch Ratings on Wednesday cut India's growth forecast to 10 per cent for the current financial year, from 12.8 per cent estimated earlier, due to a slow recovery after the second wave. It said rapid vaccination could support a revival in business and consumer confidence.

“In the near term, Q1FY22 earning is likely to provide some direction to the markets, in the absence of any major trigger. So, we remain cautiously optimistic and believe any correction at this juncture should be considered healthy as investors will get the opportunity to invest in quality counters on dips. Investors will keep a close watch on global cues, too,” said Ajit Mishra, VP-research, Religare Broking.