Equity benchmark Sensex stretched its winning run to the sixth straight session on Friday to reclaim the 56,000-level due to robust gains in banking and financial stocks amid a largely positive trend in overseas markets.
The 30-share BSE benchmark rose 390.28 points or 0.70 per cent to settle at 56,072.23. During the day, it advanced 504.1 points or 0.90 per cent to 56,186.05.
The broader NSE Nifty climbed 114.20 points or 0.69 per cent to 16,719.45.
Among the Sensex constituents, UltraTech Cement, HDFC, HDFC Bank, Axis Bank, ICICI Bank, Titan Company, Kotak Mahindra Bank and Hindustan Unilever were the lead gainers.
Infosys, NTPC, Power Grid, Wipro and IndusInd Bank were the major laggards.
The market breadth was in favour of the bulls, with 18 of the 30 Sensex stocks closing in the green.
In the broader market, the BSE smallcap gauge went higher by 0.21 per cent, while the midcap index dipped by 0.17 per cent.
A total of 1,781 stocks advanced, while 1,541 declined and 147 remained unchanged.
Among the BSE sectoral indices, bank jumped 1.49 per cent, followed by finance (1.36 per cent), basic materials (1.26 per cent) and realty (0.37 per cent).
Power, teck, telecom and IT were among the laggards.
"Equities witnessed strong rally this week with benchmark indices like BSE-30 and Nifty-50 index posting returns of 4 per cent. The market rally was broad-based with positive returns seen in BSE Midcap, BSE Smallcap and the majority of sectoral indices. BSE Metal, BSE IT and BSE Capital Goods indices moved higher by more than 5 per cent this week.
"Equity markets seem to have received support from the hope of peaking inflation amid a decline in commodity prices and the slowdown in FII selling. In fact, FIIs have been buyers for some days so far in July 2022...," Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities, said.
In the near term, markets will be tracking the upcoming Fed Reserve meeting, currency movement and quarterly results, he added.
The rupee, meanwhile slipped, 5 paise to 79.90 against the US dollar.
In Asia, markets in Tokyo and Hong Kong settled higher, while Seoul and Shanghai ended lower.
Markets in Europe were trading in the green during mid-session deals. The US equity markets had ended higher on Thursday.
"Increased foreign investment and solid quarterly results are increasing domestic demand. Among broad-based buying, banking stocks outshined due to healthy quarterly earnings. European markets traded with modest gains, while investors digested the latest ECB monetary policy as it joined the global peers in policy tightening," said Vinod Nair, Head of Research at Geojit Financial Services.
Meanwhile, international oil benchmark Brent crude dipped 0.51 per cent to USD 103.33 per barrel.
"Falling crude oil prices and rebound in FII inflows into the domestic market helped benchmark Sensex to close above the psychological level of 56,000. The fear of aggressive rate hikes by both the US Fed and RBI seems to be moderating, which is giving investors some room to lap up stocks of companies with good fundamentals.
"Extending the rally for the sixth straight session, investors bought banking and select automobile stocks," Amol Athawale, Deputy Vice President - Technical Research, Kotak Securities Ltd, said.
Foreign institutional investors were net sellers on Thursday, offloading shares worth Rs 675.45 crore, as per exchange data.
"Markets extended gains and rose over half a per cent, in continuation of the prevailing trend. After the initial uptick, the benchmark oscillated in the range but finally settled around the day's high.
"Gains in banking, realty and auto supported the surge while IT, pharma and energy witnessed profit-taking. Meanwhile, the broader indices traded mixed," said Ajit Mishra, VP - Research, Religare Broking Ltd.
Markets ended on a bullish note for the sixth day in a row, as jubilant investors took heart from this week's signs that foreign funds (FIIs) have trickled back into Indian stock markets. FIIs have been net buyers on all the trading days of this week, according to Prashanth Tapse, Vice President (Research), Mehta Equities Ltd.
"Domestic equities continued its northbound journey on the back of positive global cues and better than expected 1QFY23 earnings. Nifty opened higher and sustained momentum to close near day high with gains of 114 points (0.7 per cent) at 16,719 levels.
"Global markets were positive despite a surprise rate hike of 50 basis points by the European Central Bank, its first hike in 11 years and weak German manufacturing PMI Data," Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd, said.