The Nifty 50 index surged over 150 points to hit a new record high at 23,420.35. Gains were led by IT and financial services stocks, while FMCG and consumer durables declined.
The up move in the frontline indices comes ahead of the US CPI data and the Fed policy outcome due today. The Sensex came a few points shy of topping its earlier highs.
At 10:39 am, the Sensex was up 500 points or 0.65 percent at 76,956.28, and the Nifty was up 143.50 points or 0.62 percent at 23,408.30. About 2,360 shares advanced, 877 shares declined, and 94 shares unchanged.
The Nifty Midcap 100 surpassed 54,000 for the first time, hitting a new record high of 54,094.40.
"Midcap and smallcap stocks present a buy-on-dips opportunity. The earnings outlook for these segments remains positive, offering promising investment prospects," said Nirav Karkera, Head of Research at Fisdom. He added that the near- to medium-term outlook for midcap and smallcap stocks is positive, expecting these segments to outperform the headline indices by a comfortable margin over the medium term.
In terms of sectoral performance, excluding Nifty FMCG, the remaining 12 sectoral indices were in the green.
Among individual stocks, BPCL and Coal India were the top gainers in the Nifty 50, each rising over 2 percent.
"Amid a lack of domestic cues, markets are expected to trade within a range unless there is a shock of any sort," said Nirav Karkera.
"The daily and weekly momentum is positive, and hence, we do not expect any significant price correction," added Ruchit Jain, Lead Research Analyst at 5paisa. Jain sees immediate support for Nifty 50 at 23,050 and 22,930.
Upcoming budget and volatility
Karkera noted that the upcoming budget is a key monitorable from a near-term standpoint. "The upcoming budget has many on the sidelines, especially considering how this coalition government has come into power," he said. He expects volatility to return to pre-election levels after the budget.
The volatility index India VIX declined 2 percent to 14 in early trade today.
Globally, investors are closely watching the US CPI data and the Fed policy outcome. "US Fed commentary could provide direction to the market. So far, investors are expecting one rate cut towards the end of the year, and any deviation from that could drive the market either way," said Siddhartha Khemka, Head of Retail Research at Motilal Oswal Financial Services.
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