Sensex soars over 500 points: 3 factors behind stock market rally – haroonabadvital.com
Major indices on Dalal Street extended their gains on Tuesday, driven by strong performance in heavyweight stocks and expectations of a positive policy announcement from the Reserve Bank of India (RBI).
The S&P BSE Sensex rose 562.95 points to 80,811.03 at 12:55 pm, while the NSE Nifty50 rose 152.15 points to 24,425.85. Broader market indices were also trading in the green, reflecting widespread optimism across sectors.
Heavyweight stocks are pushing the market higher
The major contributors to the market rally were heavyweight stocks like Reliance Industries, Adani Ports and HDFC Bank. Shares of Reliance Industries rose 1.10% on the NSE and HDFC Bank rose 1.2%, providing strong support to benchmark indices.
Adani Ports emerged as the top gainer on the Nifty50, rising more than 6.2%, while Adani Enterprises added 2.5%. Other notable gainers include Cipla, Ultratech Cement, NTPC, ONGC, SBI and Axis Bank.
Banking and financial stocks played a major role in boosting the indices. The heavily weighted Nifty Bank and Nifty Financial Services indices recorded significant gains, indicating investors’ confidence in the growth potential of the sector.
Reserve Bank of India policy boosts expectations
Market sentiment was further boosted by lower volatility and expectations that the Reserve Bank of India’s Monetary Policy Committee (MPC) may announce a cut in the cash reserve ratio (CRR) in the upcoming policy review.
Commenting on the market’s resilience, Dr VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services said, “The fundamental resilience of the market is evident in its ability to bounce back. The market is not focusing on the slowdown in GDP growth but on the potential policy response to this slowdown.”
He added: “The recovery in bank stocks yesterday indicates that the market expects a reduction in the credit risk rate on Friday, which will enhance the profitability of banks. The strength enjoyed by market heavyweights such as Reliance and HDFC Bank could add resilience to the market.”
Broader gains across sectors
Sectoral indicators painted a positive picture, with gains recorded in all sectors. The high demand for banking and financial services stocks confirmed investors’ optimism about their profitability in the near term.
With the market building on its recent momentum, upcoming policy announcements and earnings reports are likely to play a pivotal role in shaping the trajectory of Indian stocks in the coming days.
