After over a week of consolidation, Tuesday was a breakout day for the benchmark indices, which clocked around 1.5% growth on the back of good news on both global and domestic fronts. While the softer-than-expected US retail sales data fuelled hopes globally that the Federal Reserve could consider rate cuts, India’s lowest trade deficit in over three years also buoyed the market mood.
The Sensex surged 1,131.31 points, or 1.53%, marking its highest gain since February 4, and reclaimed the 75,000 level to close at 75,301.26. The Nifty also jumped 325.55 points, or 1.45%, surpassing the 22,800 mark.
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“The markets decisively broke out of a week-long consolidation, surging nearly 1.5% and reinforcing the recovery momentum. The Nifty exhibited strong upward movement throughout the session, closing near the day’s high at 22,834.30, with broad-based participation across sectors led by real estate, auto and banking,” said Ajit Mishra, SVP-research, Religare Broking.
On Monday, the Dow Jones and S&P 500 gained 0.85% and 0.64%, respectively, while on Tuesday, European markets were trading up by as much as 1.20%.
Besides India, equity indices in Japan, Hong Kong, and Taiwan also ended higher on Tuesday.
“Buoyancy across global equities boosted the confidence of local investors, translating into value buying across sectors. As markets had been in a bearish mode over the past few weeks and valuations had become relatively attractive, investors seized the opportunity to invest in beaten-down sectors,” said Prashanth Tapse, senior V-P (research), Mehta Equities.
Outperforming the benchmark indices, the broader market also posted impressive gains of over 2%. The BSE Midcap rose 2.10%, while the BSE Smallcap snapped a five-day losing streak, gaining 2.73%.
The volatility index, India VIX, cooled off by 1.52% to 13.21, indicating a decline in market volatility.
The market breadth remained positive, with 2,815 gainers compared to 1,221 losers. Investor wealth rose by Rs 7.03 lakh crore during the day, taking the total market capitalisation on the BSE to Rs 399.86 lakh crore.
Why are small and midcap stocks surging today?
All sectoral indices on both the BSE and the NSE ended in the green.
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