Dear Trader…
The 30-share BSE Sensex gained 602 points, or 0.76%, to close at 80,005, while the broader NSE Nifty Future rose 155 points, or 0.64%, to finish at 24,348.
The market capitalization of all listed companies on the BSE surged by Rs 4.56 lakh crore to Rs 441.54 lakh crore.
The broader, more domestically focused Nifty Smallcap100 and Midcap100 rose about 1.2% and 0.8%, respectively. Meanwhile, the India VIX, a measure of market volatility, decreased by 2.3% to 14.3.
ICICI Bank, M&M, Infosys, and SBI collectively contributed 365 points to today’s rise in the Sensex. Sun Pharma, Reliance Industries, HUL, and TCS also added to this upward momentum.
Here's what fueled today's market rally: -
1) Dip Buying
Today's rally in the equity markets comes as investors capitalize on recent declines, with the Nifty index down over 8% from its recent peak. The mid-cap and small-cap indices have experienced even steeper corrections of 9.8% and 9.3%, respectively.
As market sentiment shifts, buyers are taking advantage of lower valuations, reflecting a belief in the long-term recovery potential of these segments.
2) Decline in Oil Prices
Oil prices tumbled by more than $4 a barrel on Monday after Israel's retaliatory strike against Iran at the weekend bypassed oil and nuclear facilities and did not disrupt energy supplies.
Both Brent and U.S. West Texas Intermediate crude futures hit their lowest since October 1 at the open. By 3:30 pm IST Brent was down $4.12, or 5.4%, at $71.93 a barrel while WTI dropped $4.03, or 5.6%, to $67.75.
3) Global Markets
Indian markets received a boost from a rally across major Asian markets, where shares rose on Monday amid developments in Japan's political landscape. The yen's dip, following Japan's ruling party losing its lower house majority, sparked fresh optimism in equities.
Japan's Nikkei 225 closed by 1.8% higher, while South Korea's Kospi edged up 1.13%. Hong Kong's Hang Seng rose by 0.1%, and China's Shanghai Composite gained 0.7%.
Meanwhile, U.S. stock index futures also pointed to an upbeat start on Wall Street later, up 0.5-0.7%, while Europe's STOXX 600 rose 0.4%, as airline stocks drew strength from lower fuel prices.
Nifty futures opened at 24258 points against the previous close of 24192 and opened at a low 24161 points. Nifty Future closed with an average movement of 331 points and decline of around 155 points and closed 24348 points...!!
Meanwhile, The market exhibited a rebound after continuous selloff last week. Positive results from banks and a slump in oil prices in expectation of an ease in retaliations in the Middle East aided investor sentiment.
Stability in the broad-based rally requires more evidence from earnings, which are currently in the doldrums of weak demand and margin pressure. We expect companies with a less leveraged balance sheet and growth prospects to outperform when the market stabilizes.
At the start of intra-day trading, October gold opened at Rs.78827 fell from a high of Rs.79044 points to a low of Rs.78623 with a rise of 230 points, a trend of around Rs.78800 and December Silver opened at Rs.96666, fell from a high of Rs.97194 points to a low of Rs.96100 with a Decline of 371 points, a trend of around Rs.96763.
Technically, the important key resistances are placed in Nifty future are at 24348 levels, which could offer for the market on the higher side. stainability above this zone would signal opens the door for a directional up move with immediate resistances seen at 24404 – 24505 levels. Immediate support is placed at 24202 – 24008 levels.
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