Nifty hits fresh record high on first day of FY25; Q4 earnings, US PCE data to guide markets

Investors are likely to resort to bargain hunting, said analysts.

Indian equity benchmark Nifty50 hit a new high of 22,529.95 levels on April 1, the first trading session on FY2024-25, going past its previous record of 22,526.6.

At 9.37 am, the Sensex was up 567.59 points or 0.77 percent at 74,218.94, and the Nifty was up 192.20 points, or 0.86 percent, at 22,519.10. About 2,606 shares advanced, 417 declined, and 128 were unchanged.

"The undertone of the market is bullish and there is momentum in the market. The market has been showing signs of consolidation but the spurt in Nifty by 322 points on the last two trading days indicates that the upward momentum can sustain," said VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

Investors are likely to resort to bargain hunting, and the recent reiteration by the US Fed that it is still looking at 3 rate cuts this year despite challenges from the inflation front is expected to keep the markets in good stead, said Prashanth Tapse, Senior VP (Research), Mehta Equities.

He added that while intra-day volatility could continue in the near term, the focus will slowly shift to fourth quarter corporate earnings which will start rolling in the next few day's time.

The Nifty's support for the day is seen at 22,200, while the key resistance moved to 22,600 after it index crossed its previous record high of 22,526.6 in the early trade.

The broader markets were on an upswing, with Nifty midcap 100 and Nifty smallcap 100 gaining up to 1.3 percent in the early trade.

All sectors traded in the green, with the media, metal and PSU bank indices clocking the most gains. Nifty PSU Bank index, in particular, has surged 90 percent in FY24. This has further potential to go up as there is plenty of valuation comfort available, opined VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

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Global Markets

The S&P 500 notched mild gains at the end of the week on Thursday, marking its best first quarter performance in five years.  US stocks finished the shortened trading week mostly higher, with both the S&P 500 and Dow Jones Industrial Average achieving their strongest gains over two consecutive quarters since 2020. This was driven by a resilient economy and hopes for potential rate cuts later in the year.

The American personal consumption expenditures (PCE) price index rose 0.3 percent last month, the Commerce Department's Bureau of Economic Analysis said. Data for January was revised higher to show the PCE price index climbing 0.4 percent instead of 0.3 percent as previously reported.

The US Personal Consumption Expenditure (PCE) price index metric is usually preferred by the Federal Reserve to shape potential interest rate adjustments in the months ahead.

Meanwhile, Japanese stocks saw weakness, with Nikkei 225 index falling 1.5 percent. However, the other Asian indices traded with gains, with South Korea's Kospi and Hong Kong's Hang Seng index recording an increase of up to 0.9 percent.

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