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The National Stock Exchange's Nifty index ended at its highest ever closing level of 8,389.9 on Friday. It was up 32.05 points or 0.4 per cent. The BSE's Sensex closed at 28,046.66. Both are all-time closing highs.
The sentiment has been positive on the back of Wholesale Price Index figures coming in at a five-year low of 1.8 per cent, according to experts. Falling inflation is also expected to help make it easier for the Reserve Bank of India to eventually cut interest rates.
On an intra-day basis, the Nifty has previously touched an all-time high of 8,415 on 12 November. The Sensex had hit an all-time high of 28,126 on Wednesday.
Ten of the 12 sectoral indices ended with gains on Friday, with profit booking in defensive sectors as investors are said to be switching to other segments which are expected to grow faster.
Indices tracking the fast moving consumer goods (FMCG) and health care sectors were down 0.1 per cent and 1.2 per cent respectively. The S&P BSE Metal index was up 2.5 per cent. The S&P BSE Realty index was up 2.3 per cent.
"We continue to be positive on the market. We now have a target of 9,250 on the Nifty by next Diwali," said Pankaj Pandey, head of research at ICICIDirect.
Crude oil has fallen below the $80 a barrel, seen as a tailwind for India as it imports around three quarters of its crude oil requirements.
HDFC Bank closed at Rs 929.3, up 1.4 per cent. The Foreign Investment Promotion Board approved a decision to allow increased foreign holding in the company.
"The market is in a good place, and as the environment turns more benign we could see more upside… We may see margin expansion but meaningful traction in earnings is more likely to take place in FY16.," said Gopal Agrawal - chief investment officer (CIO) at Mirae Asset Global Investments.
Foreign institutional investors were net buyers by Rs 646 crore on Friday. Domestic institutions were net sellers by Rs 517.5 crore.
