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Indian stock markets today closed at record highs for a fifth straight day, logging a second straight month of gains. A surge in the final half an hour of trading helped S&P BSE Sensex close 0.67% higher at 63,099.65, and the NSE Nifty 50 index finished 0.75% higher at 18,758.35. Indian markets have been on a tear since the minutes of the U.S. Federal Reserve's last meeting, released a week back, raised expectations the central bank could ease its monetary policy.

“MSCI rebalancing trades and basket buying by FPIs in the last half hour pushed up indices towards the end of the session. Cash volumes on the NSE were the highest in 6 months," said Deepak Jasani, Head of Retail Research, HDFC Securities.

“Nifty continues its march upwards with sharp spikes thrown in between. The fact that the large trades that happened today may not be repeated soon, means that Nifty could now rise gradually with some minor corrections thrown in between. On falls 18614-18678 band could provide support," he added.

According to NSE data, FIIs bought Indian stocks worth 9,000 crore (on net basis) while DIIs sold about 4,000 crore worth of equities. 

The global index provider MSCI (Morgan Stanley Capital International) rebalances its indices periodically. The adjustment for its November semi-annual index rebalancing took take place on November 30, 2021 and the rejig will be with effect from December 1.

TVS Motor Co, Varun Beverages, Tube Investments of India, Indian Hotels Co, Bajaj Holdings and Investment, and ABB India are the six Indian stocks that have been the latest inclusions in the MSCI's global standard index, according to analysts. Among individual stocks, Varun Beverages surged over 9% to a record high, after multiple block deals.

The Nifty gained 4.14% in November, while the Sensex rose 3.87%. Back home, India's retail inflation also eased to a three-month low of 6.77% in October, boosting expectations the Reserve Bank of India could also follow suit with its own rate hike path.

Traders will be looking ahead to Fed Chair Jerome Powell's speech later today, at a Brookings Institution event. Also India's July-September economic data is due later today.

The BSE midcap and smallcap indices, which are yet to hit their record highs, today however outperformed, rising 1% and 0.6% respectively.

“Indian equity markets are cheering at their all-time highs, snubbing the volatility of global markets. The broader market is also trying to catch up momentum as Nifty midcap and smallcap indices are still well below this all time highs. The beauty of the current rally is that the market is finding support from new sectors every day. In the second half of 2022, there is a clear trend of outperformance of Indian equity markets," said Santosh Meena, Head of Research, Swastika Investmart Ltd.

“The market will react to Jerome Powell's speech tomorrow, and auto sales figures will cause stock-specific movements. The market's attention will then shift to the Gujarat election and RBI policy. Globally, news flow from China may continue to cause volatility, while the movement of the dollar index, US bond yields, and crude oil prices will be other important factors. The only concern is that the market is overbought, which may lead to some pullback or consolidation at higher levels, but there are no major signs of weakness. Technically, Nifty has immediate targets of 18888 and 19000, while on the downside, 18700 and 18500 will act as strong support levels," he added.

On the day, all the Nifty sectoral indexes, except the PSU index, advanced, with metal, energy and auto climbing more than 1.7% each. (With Agency Inputs)

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