Closing Bell: Sensex & Nifty Extend Rally For 6th Straight Day Amid US Rate Cut Hopes; Midcap Stocks Shine

In a session marked by cautious optimism, the Indian stock markets extended their winning streak to six consecutive sessions on Thursday, August 22, driven by a mix of global cues and rising expectations that the US Federal Reserve might soon pivot towards a more accommodative monetary policy. The benchmark indices, Sensex and Nifty, posted minor gains, closing in positive territory despite a largely rangebound trading session.

The Sensex climbed 130 points to close at 81,035, while the Nifty 50 index added 41 points to finish at 24,812. The Nifty Bank index surged by 300 points, ending the day at 50,986. Meanwhile, the Midcap Index outperformed broader markets with gains of 401 points, closing at 58,845.

The market breadth was notably positive, with the NSE Advance-Decline ratio standing at 2:1, indicating that for every stock that declined, two advanced. This strong market breadth highlights the underlying strength and broad-based buying interest across sectors.

The domestic markets were buoyed by positive sentiment from global indices, which rose following the release of the US Federal Reserve's latest meeting minutes. The minutes revealed that the Fed is considering cutting interest rates, a move that could begin as early as September. This potential policy shift comes on the back of a downward revision in US jobs data over the past year, which has led to increased speculation that the Fed may ease its monetary stance to support economic growth.

This optimism was reflected in the performance of Indian markets, which have been closely tracking global developments. Investors are hopeful that a rate cut by the Fed could lead to a more favourable environment for equities, as lower interest rates typically reduce the cost of borrowing and stimulate economic activity.

Shares of InterGlobe Aviation, the parent company of IndiGo, surged by 4% after several brokerages upgraded the stock, citing strong operational performance and growth prospects. The upgrade comes amid a recovery in the aviation sector, driven by increasing passenger traffic and stable fuel prices.

The NBFC sector continued to attract buying interest, with M&M Financial Services and Piramal Enterprises among the top gainers. Investors are increasingly optimistic about the sector's growth prospects, supported by improving asset quality and robust demand for credit.

The cement sector extended its gains, with stocks rising up to 3% on reports of a potential price hike. The sector has been in focus due to expectations of increased infrastructure spending, which is likely to drive demand for cement products.

TVS Motor saw its stock price climb 3% to hit a record high after the company launched a new variant of its popular Jupiter scooter. Trent Ltd, a retail arm of the Tata Group, surged to a record high, gaining another 3% during the day.

The online food delivery giant Zomato ended the day flat, despite announcing plans to acquire Paytm's entertainment ticketing business for Rs 2,048 crore.

While many sectors saw gains, city gas distribution companies came under pressure, with Mahanagar Gas Ltd (MGL) and Indraprastha Gas Ltd (IGL) each falling by 2%. The decline was attributed to concerns over rising input costs and regulatory challenges, which could impact profitability in the near term.

On the other hand, Adani Power experienced a slip, while Ambuja Cements ended higher following reports of promoter stake sales. Titan continued its impressive run, gaining for the seventh straight day and rising 5% this week alone.

Other notable movers included Grasim Industries, which maintained positive momentum with a 3% rise in healthy trading volumes, and Punjab National Bank Housing Finance and Alkem Laboratories, which saw declines. However, Eris Lifesciences, Kalyan Jewellers, and NIIT Ltd ended higher after successful block deals.

In the broader markets, Indian Renewable Energy Development Agency (IREDA) surged 7% after the company announced plans to raise funds, signalling confidence in its growth strategy. Fertilizer stocks also saw significant buying, with Rashtriya Chemicals & Fertilizers (RCF) and National Fertilizers Ltd (NFL) ending 5-7% higher, driven by expectations of strong demand in the coming quarters.

Conversely, Nucleus Software fell sharply after the company's board approved a share buyback at Rs 1,615 per share, leading to profit booking by investors. Meanwhile, Eureka Forbes rose by 7% following a 0.7% equity transaction.