On Monday, benchmark stock market indices reached new heights, driven by robust performances in the IT and auto sectors. The S&P BSE Sensex climbed by 155.32 points, reaching 82,521.09, while the NSE Nifty50 increased by 77.20 points to settle at 25,313.10 by 9:35 AM.

Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, attributed the market’s upward movement to a steady accumulation of quality large-cap stocks. He noted that recent Foreign Institutional Investor (FII) buying, particularly due to large bulk deals, has positively influenced market sentiment. Vijayakumar added that if the market remains positive by the end of the day, it will mark a record 13-day winning streak for the Nifty, further boosting investor confidence.

Hero MotoCorp led the gainers on the Nifty50 with a notable increase of 2.50%, followed by Bajaj Auto, which rose by 2.28%. HDFC Life also showed strong performance, climbing 1.77%. Tata Consumer Products and SBI Life also saw gains, advancing by 1.66% and 1.48% respectively.

Conversely, Tata Motors faced the largest decline, dropping by 1.44%, while Hindalco fell by 1.13%. Mahindra & Mahindra (M&M) saw a decrease of 0.80%, with Dr. Reddy's Laboratories and ONGC experiencing drops of 0.83% and 0.62% respectively.

Vijayakumar noted that sectoral performance has been shifting rapidly. The IT sector has rebounded on hopes of increased tech spending in the US, driven by expectations of a soft landing for the US economy. Pharma stocks are also witnessing increased interest due to improving business prospects. However, there is profit booking occurring in sectors like railways and defense, driven by valuation concerns. The FY 25 Q1 GDP growth rate of 6.7% suggests mild economic sluggishness, which could prompt rate cuts by the Reserve Bank of India (RBI) in the next monetary policy meeting. Although banks are facing challenges with deposits, rate cuts could improve the outlook for banking stocks.

In the broader market indices, the Nifty Midcap100 saw a slight decline of 0.10%, while the Nifty Smallcap100 edged up by 0.04%. The India VIX, a measure of market volatility, increased by 1.41%.

Prashanth Tapse, Senior Vice President of Research at Mehta Equities, highlighted that the strong performance of the benchmark Nifty was supported by Wall Street’s recent surge following favorable inflation data, which suggested potential rate cuts in September. The optimism on Dalal Street was further buoyed by a 3.1% drop in WTI crude futures and significant FII buying of Rs 9,217 crore last week. Investors are now awaiting the August US jobs report, scheduled for release on September 6th, which could influence the Fed’s next policy move. Additionally, the upcoming IPO of Bajaj Housing Finance, set to open on September 9th with a target of raising Rs 6,560 crore, is also anticipated to impact market dynamics.

Sectoral indices on the Nifty showed mixed performance in early trade. The Nifty IT sector rose by 0.73%, Nifty FMCG increased by 0.65%, and Nifty Financial Services gained 0.21%. Nifty Private Bank saw a 0.25% rise, while Nifty Oil & Gas and Nifty Midsmall Healthcare also showed positive movement, increasing by 0.45% and 0.29% respectively.

On the downside, Nifty Metal declined by 0.55%, followed by Nifty Pharma with a fall of 0.29%. Nifty Media dropped by 0.40%, and Nifty PSU Bank lost 0.25%. Nifty Auto and Nifty Healthcare ended slightly lower, losing 0.08% and 0.15% respectively. Nifty Consumer Durables and Nifty Realty also recorded declines, with losses of 0.41% and 0.19% respectively.