Indices hit new highs, Sensex closes above 81K for first time

India's benchmark indices surged to fresh new highs on Thursday, with the Sensex closing above 81,000 and Nifty ending above 24,800 for the first time. The rally was led by gains in information technology (IT) stocks ahead of Infosys' first quarter results which were announced after trading hours on Thursday.

The BSE Sensex ended at 81,343.46 up 626.91 points, or 0.78%, after hitting its lifetime high of 81,522.55. NSE's Nifty rose 187.85 points, or 0.76%, to a close at a record 24,800.85. The index hit an all-time high of 24,837.75 during the day.

"We see the Nifty crossing 25,000 on or before the Union budget itself, and in case there is no negative news in the budget, it can extend further," said Rajesh Palviya, head of technical and derivatives research at Axis Securities. "This time the rally is purely led by large-cap stocks, while small- and mid-caps are seeing some sideways consolidation and profit taking."

Small and Midcap indices ended weak, with Nifty Midcap 150 dropping 0.94% and Nifty Smallcap 250 falling 1.11%. Out of the 4,016 stocks traded on the BSE, 1,372 advanced, while 2,549 declined.

The government will announce its Union Budget on July 23 - the first after returning to power.

Nifty's IT index gained 2.2% with TCS gaining 2.8%, Wipro up 2.4% and Infosys gaining 2.2%. Money managers said the unexpected better-than-expected June quarter results by IT companies so far have revived sentiment in these stocks.

"IT has been a surprise this results season and may continue its rally upwards," said Andrew Holland, CEO, Avendus Capital Public Markets Alternate Strategies. He said macro-indicators are favouring banks but the prospects of the stocks will depend on the first quarter results.

The Bank Nifty index gained 0.4% on Thursday to 52,620.70. "Bank Nifty, which has seen sideways consolidation in the past few weeks, is on the verge of a breakout above 52,800 and will contribute to the uptrend," said Palviya.

Nifty's India Volatility Index or VIX gained 2.02% to 14.51 on Thursday, indicating some caution.