Dalal-Street indices pare gains after scaling fresh highs
inflation report amid hopes the Federal Reserve could rein in prices without pushing the economy into recession. Leading equity benchmarks surged 1% in Thursday's trading amid a global 'risk-on' rally, with the Sensex crossing 66,000 for the first time and the Nifty rising past 19,550. However, a sell-off in the last hour of trade saw indices pare most of their gains after hotter-than-expected domestic inflation got local investors anxious.
The Sensex topped 66,064.21, beating the previous all-time high of 65,898.98. The index closed at 65,558.89, up 164.99, or 0.25% from the previous close. The Sensex had posted a closing high of 65,785.64 on July 6.
The Nifty rose to its new high of 19,567.00, surpassing 19,523.60 on July 7. The gauge closed at 19,413.75, up 29.45 points or 0.15% from the previous close. The Nifty's record closing is 19,497.30.
«We are at the cusp of strong growth coming back,» said A Balasubramanian, managing director and chief executive officer, Aditya Birla Sun Life AMC. «Our markets have more steam left and continue to see more gradual upticks.» Balasubramanian said India's indicators at a macro and micro level are showing consistent improvement, encouraging global investors to allocate funds. «Fundamentals are getting affirmed and look more appealing.
Global money will continue to flow,» he said.Overseas Markets The mood in markets overseas also reflected positive sentiment. Major indices in Asia rose 0.6-2.6% on Thursday after the US inflation print for June registered lower-than-expected at 3%, the smallest year-on-year increase in two years. European shares also reacted positively to the US inflation report and lower-than-expected contraction in the UK's economy.
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