Sensex crosses 86k for first time, Nifty at record high after 14 months: Positive global cues, other factors behind market rally

Nifty hits record high amid strong buying in markets today. 

The equity benchmarks traded higher on Thursday, with the Sensex and Nifty touching fresh record highs as buying interest strengthened across sectors amid expectations of interest rate cuts in the US and India. Strong FII buying also supported the sentiment.

The Nifty scaled an all-time high of 26,306.95, surpassing its previous peak of 26,277.35 registered on September 27, 2024, while the Sensex surpassed the 86,000-mark for the first time to hit 86,026.18.

At 10:15 a.m., the Sensex rose 318.71 points or 0.37 percent to 85,928.22, while the broader Nifty advanced to 26,278.40, up 73.10 points or 0.28 percent. About 1903 shares advanced, 1377 shares declined, and 183 shares unchanged.

Bajaj Finance, Shriram Finance, Asian Paints, Bajaj Finserv and Larsen & Toubro were the top gainers in the Nifty50 pack, rising up to 2 percent.

Key factors behind market rise

1) FII buying: Foreign portfolio investors continued their buying streak, turning net buyers for the second straight session on Wednesday. They bought shares worth Rs 4,778.03 crore, following inflows of Rs 785.32 crore on Tuesday. The steady FII interest offered support to domestic equities.

Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said "The rally has fundamental support from potential earnings growth expected in Q3 and Q4 of FY26. The consumption boom witnessed in October will translate into impressive earnings growth. If the trend sustains, even with slight moderation after the festival season, earnings growth, going forward, will be good warranting a rally in the market. But there is no room for a sharp sustaining uptrend since valuations do not support that. Expectation of a rate cut by the Fed and a possible Russia-Ukraine peace accord have improved sentiments for equity markets globally."

2) Rate cut hopes: Sentiment also remained firm on growing expectations that the U.S. Federal Reserve may cut rates in December. The Nifty had logged its best session in five months on Wednesday, closing at a 14-month high, aided by gains in rate-sensitive counters ahead of the Reserve Bank of India’s policy review next week.

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3) Positive global cuues: Asian markets traded higher as traders increased their bets on a Federal Reserve rate cut next month. According to the CME FedWatch tool, the probability of a December cut rose to about 85 percent from 30 percent a week ago.

In Asian markets, South Korea's Kospi, Japan's Nikkei 225 index, Shanghai's SSE Composite index and Hong Kong's Hang Seng index were trading in positive territory. US markets ended higher on Wednesday.

4) Crude declines: Brent crude slipped 0.48 percent to USD 62.83 per barrel. Softer crude prices are generally positive for India as they help ease import costs and reduce pressure on inflation.

5) IMF outlook on India: The IMF, in its latest staff consultation report released on November 26, projected that India will reach the USD 5-trillion mark in FY29, a year later than earlier estimated. While the revised timeline reflects slower nominal GDP growth and rupee depreciation, the longer-term growth outlook remains supportive for investor sentiment as it underscores expectations of continued economic expansion.

Technical View

Anand James, Chief Market Strategist at Geojit Financial Services, said Wednesday’s bullish engulfing pattern indicates room to maintain the 26,470–26,550 target. However, he noted that the formation primarily reversed a four-session declining trend rather than establishing a stronger uptrend. He added that while the index may hold a positive bias above 26,165, traders will watch for profit-booking if it fails to sustain above 26,098.

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