The stock markets have shown signs of recovery after falling almost 12% from it’s September high as it continued its winning streak, extending gains for the third starlight session on Thursday. Sensex gained over 400 points in early trade while Nifty was up nearly 150 points.
The S&P BSE Sensex was up 308.61 points to77,032.69, while the NSE Nifty50 added 105.75 points to23,318.95 as of 10:25 AM.
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Rise in the stock market could be attributed to several factors, of which the positive US inflation data was the biggest trigger for Sensex and Nifty.
WHY DID STOCK MARKET GAIN TODAY
US stocks rose on Wednesday night after new numbers showed US core inflation grew less than what experts had thought it would. This good news spread to Asian stock markets on Thursday, pushing them higher too.
The US dollar and interest rates on US government bonds have come down a bit in the last few days. Some market watchers think the recent rise in stocks tied to Donald Trump might have reached its peak.
Adding to the positive market sentiment in markets, Israel and Hamas agreed to stop fighting in Gaza, which helped calm worries about the conflict. This made investors feel better about putting money into stocks. Many think this could slow down the recent trend of foreign investors taking their money out of markets.
Closer to home, investors were waiting eagerly for three big Indian companies – Reliance Industries, Infosys, and Axis Bank – to share their latest earnings reports later in the day.
Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services said that macro indicators from the US suggest that as the swearing-in of Mr Trump nears, the Trump trade has peaked.
“The decline in US bond yields and the dollar index are indications of this. This downshift in the dollar index and bond yields has been assisted by the lower-than-expected CPI inflation in the US, again igniting hopes of more rate cuts by the Fed this year. Hope of an end to the conflict in Gaza is another major relief. This global backdrop is positive for the market,” he added.
He also said that a relief rally in India is certainly on the cards, but the sustainability of the rally will depend on the Indian macros, particularly the revival of GDP and earnings growth.
“Budget expectations can aid a rally in the market but it will soon give way to the trends in GDP and earnings growth.Investors should focus on largecaps which have been more stable than the mid and small caps. Broadly speaking, segments with growth visibility like Pharma and health care, IT and discretionary consumption will remain resilient,” saidVijayakumar.
The share price of HDFC Life Insurance Company surged almost 11% on January 16 after the insurer announced its October-December quarter results, which was much better than what Dalal Street had expected.
HDFC Life shares were up 10.28% to Rs 655.35 at around 10:17 am. Earlier, the stock had reached a days high of Rs 657.80.
The company posted a 14% rise in net profit in Q3 FY25 at Rs 415 crore, higher than Rs 365 crore in the same period last year, driving positive investor sentiment.
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