Sensex Soars, Nifty Climbs Post-Budget; Auto, Metal Stocks Lead

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Posted by AI on 2025-08-13 11:35:52 | Last Updated by AI on 2025-08-14 01:45:26

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Indian equities soared to record highs on Wednesday, buoyed by firm global cues and aided by cooling domestic inflation data.

The BSE Sensex climbed 303.95 points, or 0.52%, to reach a new high of 60,284.17, while the broader NSE Nifty advanced 76.05 points, or 0.31%, to a fresh record close of 24,619.85.

The auto and metal stocks led the gains on the indices, rising 1.91% and 1.63% respectively.

"The markets are reflecting the positive mood post the union budget, which was growth-oriented and focused on fiscal consolidation," said Dhiraj Relli, MD and CEO of HDFC Securities. "The market will now closely watch the outcome of the Union elections and RBI policy meeting."

Global markets also surged, with most Asian peers closing higher as investors digested a slew of Chinese economic data showing the recovery path in the world's second-largest economy.

The Shanghai Composite Index rose 0.53%, South Korea's Kospi added 1.32%, and Australia's S&P/ASX 200 rose 0.78%.

Meanwhile, in the forex market, the Indian rupee rose against the US dollar, tracking positive domestic equities and weakening US dollar overseas.

The currency settled at 74.51 against the US dollar, compared with Tuesday's close of 74.64.

These surges come as the annual rate of consumer price inflation fell to a four-month low of 5.3% in January, helped by a slower rise in food prices and lower costs for transport and fuel.

This marks the third straight month that retail inflation remained within the Reserve Bank of India's (RBI) target range of 2%-6%.

The core inflation index, which excludes volatile food and fuel prices, rose to a near-eight-year high of 6.1% in January, from 6.6% a month earlier, according to the Centre for Monitoring Indian Economy (CMIE).

The consumer price index (CPI) rose 4.3% in January compared with a year earlier, down from 5.6% in December, according to the data from the National Statistical Office (NSO), which released the numbers on Wednesday.

The January numbers are likely to reassure policymakers as the RBI, which has a medium-term target of 4%, has repeatedly missed its inflation goal since the beginning of the pandemic.

The central bank is expected to raise interest rates soon to curb price rises, which have been triggered in part by high commodity prices and supply chain bottlenecks.

Many economists now expect the RBI to start raising rates in the next few months, with a 25 basis point hike at its upcoming April policy meeting.

Only time will tell what the future holds for the Indian economy. Still, for now, it seems that investors are optimistic about India's growth potential in the post-pandemic era.

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