The morning of Wednesday, October 21 brought a big relief for stock market investors. As soon as the market opened amid continuous ups and downs, greenery was everywhere. Sensex turned bullish and gave a strong jump of around 800 points. Along with this, Nifty also managed to cross the important magical figure of 23,000. The tumultuous recovery has rekindled the confidence of investors who had been spooked by the recent push. This market trend shows that investors’ confidence in the domestic economy is still intact.
Showed strength in early business
The major indices looked very strong as the market opened. The Sensex surged 656.66 points straight to 74,499.56. Similarly, the Nifty 50 saw a sharp jump of 182.30 points to start trading at 23,095.25. The biggest reason for this initial surge was bumper buying in IT and banking stocks. Investors invested generously in these sectors. The Nifty IT index rose 618.45 points to 32,134.75 with a strong gain of 1.96 percent. The Nifty Bank also settled at 55,650.65 with an increase of 162.55 points.
There were good indications from Gift Nifty
Market leaders were aware of the surge in the morning. Choice Broking’s Technical Research VP Sachin Gupta gave clear indications about this even before the market opened. He said Gift Nifty was trading up 75 points at 23,009. This indicates a very positive start for the Indian markets. However, Sachin Gupta also warned the investors. He said how strong the recovery would be would depend entirely on global cues, crude oil movements and institutional investors’ fund flows.
The market was supported by local investors
Currently, the high prices of Brent crude are creating tension in the global market. Apart from this, the bond yield in America is also continuously increasing. VK Vijayakumar, chief investment strategist at Geojit Investments, opines that these external factors may definitely put pressure on the market for some time. But despite all this the Indian market is standing strong. The biggest reason for this is the strong liquidity within the country. The market is getting a lot of support at lower levels due to fair valuations of large companies’ stocks.
Spring returned for these two reasons
Two major reasons are mainly working behind this stupendous recovery in the market. The first reason is the strong second quarter results. Many companies in the IT and banking sectors have performed well in their second quarter results. Another big reason is their very attractive valuation. Seeing this great opportunity, domestic institutional investors are buying these stocks heavily on any small decline.
