India’s benchmark indices ended at record closing levels on Friday, 27th August 2021. The Sensex finished above 56,000 and the Nifty ended past 16,700 — both for the first time. Gains were however measured as investors awaited US Federal Reserve Chairman Jerome Powell’s remarks on Friday at the annual Jackson Hole symposium.
The Nifty ended up 68.30 points or 0.41% at 16,705.20 after touching an all-time high of 16,722.05 during the day. The Sensex ended up 175.62 points or 0.31% at 56,124.72.
The broader market got a breather from the recent rout with the S&P BSE Mid and SmallCap indices gaining 1%. Sentiment has been jittery in August so far as investors have been fretting over the likelihood of a sooner-than-expected reversal of the US stimulus programme that has pumped billions of dollars into various markets worldwide. On Friday, overseas investors sold shares worth almost ₹779 crore, while domestic institutions were net buyers to the tune of ₹1,646 crore.
This marked the fifth consecutive day of selling by foreigners. They have sold equities worth ₹5,300 crore over the week but remain buyers for August with net purchases amounting to ₹2,765 crore.
Continued purchases by local mutual funds and insurance companies have helped the Sensex and Nifty advance, outperforming most regional peers. Mid- and small-cap stocks have taken a beating with the recent selloff driving retail investors to the exit door.
So far in August, the Sensex is up 6.7%, taking gains in 2021 to 17.5%. The MidCap index is up 0.7%, while the SmallCap index is down nearly 2%. Outside the indices, many midand small-cap stocks are down at least 20-30% from their highs in July. So far this year, MidCap index is up 29.6% and the Small-Cap index is up 45%. Companies must deliver in line with market expectations for stock prices to sustain at these levels.
Brokerages said the market is also nervous about the resurgence of Covid-19.