Benchmark equity indices surged on Thursday, with the Sensex and Nifty reaching their all-time highs. This rally followed the Reserve Bank of India’s (RBI) approval of an unprecedented Rs 2.11 lakh crore dividend to the government, bolstered by strong buying in blue-chip stocks such as Reliance Industries and HDFC Bank. The 30-share index climbed 951.22 points, or 1.28%, to a record 75,172.28. The index rose by 308.45 points, or 1.36%, reaching an all-time high of 22,906.25.
Top performers and laggards
Major gainers included Larsen & Toubro, Maruti, Mahindra & Mahindra, Axis Bank, IndusInd Bank, HDFC Bank, Bajaj Finserv, State Bank of India, and Reliance Industries. PowerGrid, Sun Pharma, NTPC, and JSW Steel were among the laggards.
RBI dividend boost
The RBI announced a record Rs 2.11 lakh crore dividend to the government for the fiscal year ending March 31. This amount is more than double the budgeted expectation, significantly boosting government revenue as a new administration takes office. The decision was approved during the RBI board’s 608th meeting on Wednesday.
Market analysts’ insights
V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services: “The biggest positive for the market is the record dividend from the RBI to the government, which can reduce the fiscal deficit and increase infrastructure spending.”
Santosh Meena, Head of Research, Swastika Investmart Ltd: “The RBI’s substantial dividend is a significant macroeconomic positive for the market, directly impacting the fiscal deficit and bond yields.”
Global market influence
The decline in Brent crude to below USD 82 per barrel is seen as positive for India’s macroeconomics. The US Federal Reserve’s meeting minutes indicated concerns over persistent inflation, posing a potential negative for equity markets.
Foreign Institutional Investors (FIIs)
FIIs sold equities worth Rs 686.04 crore on Wednesday, according to exchange data.
Previous session performance
BSE Sensex gained 267.75 points, or 0.36%, to settle at 74,221.06 on Wednesday. NSE Nifty advanced 68.75 points, or 0.31%, to finish at 22,597.80.
Asian and wall street markets
Tokyo traded higher, while Seoul, Shanghai, and Hong Kong were lower. Wall Street ended in negative territory on Wednesday.
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