New Delhi: There was a bumper rise in the stock market on Friday. BSE Sensex jumped 1,961.32 points and again reached the level of 79,000. This sensitive index of 30 shares closed at 79,117.11 points with a gain of 2.54 percent. At one time during trading it had climbed up to 2,062.4 points. Similarly, Nifty of National Stock Exchange (NSE) also closed at 23,907.25 points with a gain of 557.35 points or 2.39 percent. This sharp rise in the market has surprised people. Especially at a time when Gautam Adani has been accused of bribery and fraud in America. The war between Russia and Ukraine has intensified. This has created geo-political tension. Come, let us know which factors played the biggest role in today’s rise. This rise has come before the results of the upcoming state elections on Saturday. Banking giants like Reliance Industries, ICICI Bank and State Bank of India (SBI) and IT firms like Tata Consultancy Services (TCS) and Infosys played a key role in this recovery. Recovery in many shares of Adani Group improved the market sentiment. Some exit polls and Phalodi Satta market trends also helped the shares rise. These are pointing towards the victory of the BJP led Mahayuti alliance in Maharashtra.
This factor was most important
Analysts say the possibility of a victory for the BJP-led coalition would indicate that policies emphasizing infrastructure and capital expenditure will be continued. American stock markets saw a rise of about 1 percent overnight. This also boosted market sentiment.
Vishnu Kant Upadhyay, AVP of Research and Advisory at Master Capital Services, said, “Market sentiment has been strengthened by the exit polls of Maharashtra elections, which are pointing towards the victory of the Mahayuti alliance. This will be the BJP-led NDA’s second consecutive state assembly victory after Haryana. This is being seen as a positive sign for the government-led capital expenditure initiative.
aggressive buying at lower levels
The market got support from all-round buying at lower levels. Besides, strong buying by domestic institutional investors also boosted the market. Reliance, the highest valued stock on Dalal Street, closed with a gain of 2.62 per cent. Apart from this, the rise in shares of SBI and TCS also helped in taking the market higher.
VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said, ‘The market may recover from the current levels as the main reason for yesterday’s fall was the fall of Adani issue. But, given the headwinds the market is facing, chances of a sustained recovery are slim. Vijayakumar said that the strength seen in the broader market should not be mistaken for fundamental strength.
JM Financial said that exit polls are projecting the Mahayuti alliance to get a majority in Maharashtra with 150 seats, while the picture is not clear in Jharkhand, where the NDA is expected to get 39 seats. He is 2 seats behind the majority.
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What factors have historically driven market surges in India?
Engaging Interview Between Time.news Editor and Vishnu Kant Upadhyay
Time.news Editor: Good day, Vishnu! Thank you for joining us today. It must be quite an exciting time in the stock market with the BSE Sensex seeing a significant jump of nearly 2,000 points. What’s your take on what specifically drove this surge?
Vishnu Kant Upadhyay: Thank you for having me! Indeed, it’s been a remarkable day in the market. The surge can be attributed to several factors. Foremost, the optimism surrounding the Maharashtra state elections played a major role. Exit polls indicating a likely victory for the BJP-led Mahayuti alliance have positively impacted market sentiment.
Time.news Editor: That’s interesting! So, you’re saying that political outcomes are influencing investment decisions? Can you elaborate on that connection?
Vishnu Kant Upadhyay: Absolutely. A win for the BJP coalition suggests a continuation of policies focusing on infrastructure and capital investment, which are vital for economic growth. Investors generally respond favorably to stability and predictability in governance, especially when it comes to policies that affect the business landscape.
Time.news Editor: We’ve also seen the recovery of shares from the Adani Group contributing to this bounce back. In light of the recent allegations against Gautam Adani, how significant is this recovery for overall market sentiment?
Vishnu Kant Upadhyay: The recovery of Adani shares indeed contributed to market positivity today. Despite the controversies, the market often reacts to short-term recoveries. Investors might see a bargain opportunity, believing these stocks could rebound eventually. Sentiment is influenced by many factors, and when large-cap companies like Adani show recovery, it instills confidence across the board.
Time.news Editor: That’s a fascinating perspective. We can’t ignore the global dynamics, though. How did the American stock market’s rise the night before influence the Indian markets here?
Vishnu Kant Upadhyay: The correlation between global markets is crucial. A 1% rise in American markets can significantly boost the confidence of domestic investors here in India. It provides assurance that global economic conditions may be stabilizing, opening up opportunities for investment back home.
Time.news Editor: Moving beyond just the politics and economics, is there a psychological aspect at play with this sudden rise? How do you think ‘excitement’ in the market influences investor behavior?
Vishnu Kant Upadhyay: Great question! There’s definitely a psychological element. The stock market often thrives on sentiment—fear, greed, excitement. Days like today, when there’s a notable rise, can lead to herding behavior where investors rush to buy, driven by the fear of missing out on potential gains. This can create a snowball effect, further driving up stock prices.
Time.news Editor: Absolutely, and it’s a dynamic we see often. Looking ahead, how do you perceive the market performing leading into the results of the state elections and beyond?
Vishnu Kant Upadhyay: If the exit polls are confirmed and the BJP coalition wins, we might see sustained positive momentum in the market. Investors will likely remain optimistic, though they’ll be keeping a close eye on global events, especially the ongoing geopolitical tensions with Russia and Ukraine, which could weigh heavily on market performance.
Time.news Editor: Thank you for sharing your insights, Vishnu. It’s always enlightening to hear from experts like you during such pivotal moments in the financial landscape.
Vishnu Kant Upadhyay: My pleasure! Let’s keep an eye on how the situation unfolds; it promises to be an interesting time for the markets.