Tech stocks power market to new high

The Nifty and Sensex broke out of a two-week range to hit record highs on Friday, after beaten-down tech stocks rose the most in almost three-and-a-half years on hopes that rate cuts in developed economies would increase software spends by companies located there. The outlook for equities remains bullish, with IT stocks set to join the rally with banking stocks after a year of underperformance.

- Ram Sahgal & Mayur Bhalerao

The Nifty rose to a record high of 21,928.25, while the Sensex surged to a fresh life high of 72,720.96, before settling slightly lower. The Nifty and Sensex ended up 1.14% and 1.18% higher at 21,894.55 and 72,568.45.

The biggest contributors to the Nifty’s 247-point gain were Infosys that added 88.65 points or almost 36% of the index move, TCS (31.25 points), ICICI Bank (18.15 points), L&T (15.84 points) and Reliance Industries (15.34 points). Infosys and TCS alone accounted for almost half of Nifty’s Friday gains.

The rally in Infosys, TCS, TechM and LTIMindtree moved the sectoral Nifty IT needle by 5.14%, its highest since 15 July 2020, when it rose 5.24%.

The Nifty, as per option writers, could trade in a 21,800–22,300/22500 range next week, with the bias tilted to the upside.