India's blue-chip indexes Nifty 50 and Sensex hit fresh record highs on Friday, aided by faster-than-expected domestic economic growth, while analysts saw extraordinary bullish sentiment from domestic investors in the derivatives segment.

The blue-chip index NSE Nifty 50 was up 1.50% at 22,312.65, while the BSE Sensex also added 1.50% to 73,588.04, as of 1:57 p.m. IST.

Ten of the 13 major sectors logged gains. The broader, more domestically focussed small- and mid-caps gained 0.6% each, underperforming the benchmarks.

The total market capitalisation of all NSE-listed Indian stocks has risen to $4.64 trillion, slightly below the record high of $4.69 trillion, with eight of the Nifty 50 stocks logging new highs on the day. Besides these, 18 other Nifty 50 stocks have hit record highs in 2024 so far.

While the benchmarks scaled fresh peaks, all the 13 major sectors were trading below their record high levels.

The rise comes after data on Thursday showed the Indian economy grew 8.4% in the October-December quarter, the fastest pace in six quarters and also above estimates, aided by robust manufacturing and construction activity.

Considering the overall long positioning and extraordinary bullish sentiment from the client segment (high net worth individuals and retail) in derivatives segment, we anticipate the Nifty to reach fresh highs in March, but sustaining that level will be a challenge, according to an analysis by Nuvama Alternative and Quantitative Research.

The market-wide open interest hit record highs at the end of the February derivatives series on Thursday, signalling strength in the market.

Analysts added that strong domestic GDP data and in-line U.S. inflation reading also aided sentiment.

Among sectors, energy and oil and gas jumped 2% and 1.75%, respectively. Financials added 1.75%, while banks gained 0.8%.

Metals climbed 3.35%, led by a similar increase in Hindalco Industries after a CLSA upgrade, citing attractive valuations. The stock has shed 18% in the first two months of 2024.




(Reporting by Bharath Rajeswaran and VarunVyas Hebbalalu in Bengaluru; Editing by Eileen Soreng and Sonia Cheema)