Sensex tops 72k for first time; Nifty eyes up to 5% more rally after hitting new all-time high

Nifty could eye 22,000 levels in the next few sessions as it breaches another record high, said analysts

Bulls continued to dominate domestic markets on December 27 as benchmark NSE Nifty 50 scaled to fresh lifetime highs of 21,673 levels and BSE Sensex clocked all-time highs of 72,110 levels towards the end of the trading session.

Market watchers believe that the Santa Claus rally is on and bulls will continue to rule the Street ahead of the monthly F&O expiry.

Chokkalingam G, Founder, of Equinomics Research, for instance, forecasted another 2-5 percent upside for NSE Nifty 50 in the run-up to 2024 general elections. "India's growth story is well-primed, along with other factors like institutional flows and shift expected to largecaps from mid-and smallcaps," he added.

On the other hand, Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher told Moneycontrol that Nifty could eye 22,000 levels in the next few sessions as it breaches another record high.

At close, the BSE Sensex shut shop 0.9 percent higher at 72,038 levels, while NSE Nifty 50 ended 1 percent higher at 21,654 levels on December 27.

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Bank Nifty index clinched record highs

The bullish undertone pushed Bank Nifty to all-time highs as well. Bank Nifty crossed the 48,240 barrier on December 27 intra-day deals helped by gains in HDFC Bank, SBI, Bank of Baroda, PNB, and IndusInd Bank.

What's next? Parekh of Prabhudas Lilladher pointed out that Bank Nifty's race to the 49,000 mark will begin as soon as it has crossed the 48,200 barrier.

Shrey Jain, Founder and CEO of SAS Online, too, reiterated a bullish stand, saying that if Bank Nifty manages to stay above the 48,200 level, it can move ahead to the 48,500 level.

However, Rajesh Bhosale, equity technical and derivative analyst at Angel One expects Bank Nifty to consolidate around 48,200 levels as institutional activity remains muted towards the year-end.

As HDFC Bank was the star performer from the Bank Nifty index on December 27, market expert Prakash Diwan pencilled in the stock to shine prominently post-March 2024.

"For investors not holding HDFC Bank yet, this is seen as an opportune moment to invest and hold rather than trade actively. Considering its current price-to-book multiple, which is lower than FY19, there's ample potential for HDFC Bank. There's an untapped potential in cross-selling to HDFC customers, yet to be fully explored by HDFC Bank," he added.

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Mid-and smallcaps in a 'bubble zone'

Broader indices, too, fared well on December 27, with Nifty Midcap 100 and Nifty Smallcap 100 gaining up to 0.6 percent. However, analysts continue to remain cautious over its excessive valuations and expect some correction on the horizon.

"There is frenzy in the mid and small cap segments where valuations are excessive. A correction in the broader market is inevitable," flagged  V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

Overall, consensus rested that markets are leaning towards the positive side, aiming to end the year on a strong note.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.