Sensex reclaims 84K level for first time since October, nears peak

Log best weekly gain since May 16

Benchmark indices rose for a fourth straight session on Friday, with the Sensex closing above the 84,000 mark for the first time since October 1, 2024. The rally was fuelled by improving sentiment amid easing geopolitical tensions and optimism over potential trade deals between the US and its trading partners. 

Both indices posted weekly gains of 2 per cent, the most since the week ended May 16. The Nifty rose 0.35 per cent, or 89 points, to settle at 25,638, while the BSE Sensex climbed 0.36 per cent, or 303 points, to close at 84,059. Both benchmarks ended at their highest levels since October 1. In the broader market, the Nifty Smallcap 100 and Midcap 100 indices gained 4.3 per cent and 2.4 per cent, respectively, over the week.  

 

Most of the week’s gains were driven by HDFC Bank and Reliance Industries (RIL), the top two weights in the Sensex and Nifty. RIL rose 3.5 per cent this week, supported by upbeat earnings forecasts from multiple brokerages. HDFC Bank gained 2.5 per cent during the week on expectations of lower funding costs and strong gross domestic product growth.  

The Nifty and Sensex are now trading less than 3 per cent below their all-time highs, last seen on September 27. 

The week’s gains followed the announcement of a ceasefire between Israel and Iran, which led to a decline in oil prices. 

 

Most Asian markets also gained on Friday after the US and China agreed to fast-track rare earth shipments, signalling easing trade tensions between the world’s two largest economies. 

The Nifty Metal index outperformed this week, jumping nearly 5 per cent as a weaker dollar lifted the global outlook for commodities by making them more affordable. 

Expectations of deeper US rate cuts and uncertainty ahead of former President Donald Trump’s July 9 tariff deadline weighed on the dollar. 

“Things are looking better on the geopolitical front, and there is hope that the US and its key trading partners will reach a deal,” said Ambareesh Baliga, independent equity analyst. Even if a deal doesn’t materialise before the July 9 deadline, there’s a chance of an extension, Baliga said. 

Market breadth was positive, with 2,165 stocks advancing and 1,846 declining. 

Foreign portfolio investors were net buyers to the tune of ₹1,397 crore, while domestic institutional investors were net sellers to the tune of ₹589 crore. The total market capitalisation of BSE-listed firms rose by ₹2.5 trillion to ₹460 trillion ($5.4 trillion).  

“For trend-following traders, 25,500–25,300 on the Nifty and 83,300-82,700 on the Sensex would act as crucial retracement support zones. As long as the market remains above these levels, the uptrend is likely to continue on the higher side, with 25,850/84,400 serving as the immediate resistance level,” said Amol Athawale, VP-Technical Research, Kotak Securities. 

Meanwhile, the rupee strengthened for the second consecutive day on Friday, supported by likely inflows from global funds and a weaker dollar index. The domestic currency closed 22 paise higher at 85.49, a day after closing at 86.71 against the dollar. The currency saw its best week since January 2023, driven mainly by a plunge in crude oil prices amid Israel-Iran conflicts.