As of early afternoon trading, the Nifty 50 index has surged by 1.37%, reaching 23,671.15, while the Sensex has climbed 1.42% to 77,993.82. This marks the sixth consecutive day of gains for both indices, driven largely by robust performances in the banking and real estate sectors. Last week, the Nifty achieved its best weekly performance in four years, setting an optimistic tone for the market.
Market Trends and Highlights
Both the Nifty 50 and Sensex hit impressive intraday highs—the Nifty reaching 23,677.90, the highest since February 7, and the Sensex peaking at 78,005.26, also the best since early February. Raamdeo Agrawal, the Chairman and Co-Founder of Motilal Oswal Financial Services Ltd, commented, “After a period of correction, the markets are finally beginning to show signs of recovery.”
Banking Stocks Drive the Rally
The day’s rally was primarily led by banking stocks, which have seen a significant recovery after a period of decline. Notably, the Nifty Bank index hit a three-month high, while the Nifty Financial Services index approached a six-month peak. Key contributors to this upward momentum included:
- Kotak Mahindra Bank: Shares surged over 5%, trading at Rs 2,184.25.
- Other significant gainers included NTPC Ltd., Power Grid Corp. of India, Axis Bank Ltd., and State Bank of India.
- Additional stocks that performed well included Bajaj Finserv Ltd., Reliance Industries Ltd., ICICI Bank Ltd., and Tech Mahindra Ltd..
Foreign Portfolio Investment Increases
Provisional data indicates that foreign portfolio investors (FPIs) purchased shares worth Rs 7,470.36 crore on Friday, following a buy of Rs 3,239 crore the previous day. This influx has sparked optimism about a potential shift in FPI sentiment towards Indian equities.
Valuations and Market Corrections
The markets have experienced a downturn since their peak in September 2024, with the Nifty down by 9.89% and the Sensex declining by 9.10%. Earlier this year, both indices faced declines of around 6.8%. However, this correction has eased some of the inflated valuations in the Indian stock market. Gautam Duggad, head of research for institutional equities at Motilal Oswal Financial Services, noted that this market correction offers “breathing space” for long-term investors.
Indian Rupee Strengthens
In a positive sign for the economy, the Indian rupee appreciated 35 paise, reaching 85.62 against the US dollar—the strongest level since January 1. Since mid-March, the rupee has strengthened by 3.56%, effectively recovering from previous annual losses against the dollar.
The current market dynamics present an encouraging landscape for investors, with stabilizing currencies and a potential resurgence in foreign investment. As always, staying informed and agile will be key in navigating the ever-evolving financial terrain.
