NSE Nifty crosses 9,400 for first time; Sensex hits new lifetime high on upbeat monsoon rainfall prediction by IMD

Making history, the 50-scrip NSE Nifty crossed the 9,400-mark for the first time in its history on Wednesday at close to end of the session even as the 30-scrip BSE Sensex hit lifetime high of 30,271 during the day.

The buoyancy in Indian stock markets is due to the upbeat forecast for monsoon rainfall this year, by the India Meteorological Department (IMD). 

On Tuesday, the IMD projected monsoon to be "normal" this year, leading to 100 percent rainfall as against the earlier forecast of 96 percent.

This lifted sentiments for the stock markets, leading to a spurt in FMCG and auto stocks. Hindustan Unilever Ltd. (HUL) rose to a new high of Rs 998 before settling down at Rs 993, up 4.32 percent.

"IMD's latest rainfall forecast indicates of above normal monsoon in 2017 which bodes well for the economy. Considering the juncture at which Indian markets are, strong monsoon helps in fortifying the confidence in our economy. We believe that this is likely to be the next trigger for the markets," Vaibhav Agrawal, Head of Research and ARQ at brokerage Angel Broking, said in a note on Wednesday.

"With the strong rainfall this year, we believe that economy will continue to see higher farm output which will ease the inflation worries further. Optimistically speaking, this may lead to lower the interest rates further," he added.

The BSE Sensex closed (provisionally) at 30,248, up 315 points, or 1.05 percent while the NSE Nifty ended 90 points, or 0.97 percent higher, at 9,410.

Top Sensex gainers were Bharti Airtel, HUL and HDFC.

"IMDs latest upgrade on normal monsoon due to ease in El Nino effect has added optimism in the market taking it to a new high. A good monsoon will raise the prospects of the Indian economy especially for FMCG and consumer durables sector," Vinod Nair, Head of Research, Geojit Financial Services, said in a note.