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India’s benchmark Nifty 50 index hit an all-time high on Friday, lifted by gains in Reliance and information technology (IT) stocks, and as the government’s fiscal prudence in its budget also boosted sentiment.

The NSE Nifty 50 index hit a high of 22,126.80 points, notching its fifth record high for the year.

It was up 0.95% at 21,902.15 as of 1:05 p.m. IST, while the S&P BSE Sensex gained 0.85% to 72,262.91.

Reliance Industries, ICICI Bank and Infosys — three of the five heaviest-weighted Nifty stocks — jumped between 1% and 2.5%.

Twelve of the 13 major sectors logged gains, led by a 3% increase in both energy and oil and gas stocks.

“Large-caps like Reliance and HDFC Bank have come to the fore in this leg of the rally,” said Saurabh Jain, assistant vice president of research for retail equities at SMC Global.

“The allocations could shift further towards the segment from small- and mid-caps as investors seek safety in an expensive market.”

The broader and more-domestically focussed small- and mid-cap sub-indexes rose 1.4% and 0.91%, respectively.

The gains in the mid-caps were capped by Paytm nosediving 20% for the second day in a row, resulting in $2.1 billion being wiped off its market value in the two days since the central bank ordered its banking arm to stop taking fresh deposits.

The government’s fiscal prudence in its budget presentation on Thursday also aided market sentiment, analysts said.

“The budget won’t add to inflation, giving room to RBI (the central bank) to ease (rates) later in the year,” HSBC analysts said.

“And this is precisely the winning stroke of this budget, lowering the fiscal deficit, without imparting a negative impulse on growth.”

The IT index gained 2%. The Federal Reserve on Wednesday doused hopes of a U.S. interest rate cut in March. (This story has been corrected to say fifth, not sixth, in paragraph 2)

(Reporting by Sethuraman NR and Bharath Rajeswaran in Bengaluru; Editing by Savio D’Souza)

  • Published On Feb 2, 2024 at 03:39 PM IST

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