Nifty, Sensex hit record highs: Five reasons why market is rallying today

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Nifty defied mixed global cues and scaled their fresh record highs of 67,771 and 20,167.65 in morning trade on Thursday. The market was witnessing a broad-based rally as the BSE Midcap and Smallcap indices jumped over a per cent higher each. Most sectoral indices witnessed healthy buying in the morning session.

Shares of Infosys, Tata Steel, Tech Mahindra, Mahindra and Mahindra (M&M) and State Bank of India (SBI) were among the top gainers in the Sensex index. Among the sectoral indices, realty, metal and PSU bank packs rose over a per cent each. Here are the five factors that seem to be behind the market hitting record highs today: 1. Expectations of the end of monetary tightening: The market is expecting that the US Fed will not raise rates in September even as the US inflation print for August came slightly above Street expectations.

Experts point out that the rent macro data shows the US economy is feeling pressure due to aggressive monetary tightening by the US Fed. "Inflation data from the US present a mixed picture. While the CPI inflation data for August has come at 3.7 per cent against expectations of 3.6 per cent, core inflation was on expected lines coming at 4.3 per cent.

So, the market thinking is that the Fed is likely to pause in September," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. 2. Healthy domestic macro numbers: India's recent macroeconomic numbers seem to have infused fresh optimism among investors.

Consumer Price Index (CPI)-based inflation, or retail inflation, moderated to 6.83 per cent in August from a 15-month high of 7.44 per cent in July. Core inflation at 4.8 per cent remained in line with the market’s expectations. Besides, India’s factory output rose to