The Indian stock market witnessed a stellar rally on Wednesday, with the benchmark Nifty 50 index crossing above 20,000 mark for the first time since September 2023. It amid positive global cues. Strong gains in index heavyweights like M&M, Tech Mahindra, HDFC Bank, Reliance Industries, among others lifted the market for the second consecutive session.
Milestones Achieved: Nifty 50 and BSE Sensex Soar
The Nifty Midcap 100 index hit a record high. While Nifty 50 is now just 1% away from its all-time high of 20,222.45 hit on September 15. The BSE Sensex hit its all-time peak of 67,927.23 on the same day. Meanwhile, the combined market valuation of all BSE-listed companies reached the $4 trillion milestone for the first time ever.
Market Cap Surpasses ₹333 Lakh Crore: A Closer Look
Led by the optimism in equities, the market capitalisation of BSE-listed companies crossed ₹333.26 lakh crore in morning trade. It translating into $4 trillion at the exchange rate of 83.31. While the BSE benchmark Sensex has rallied 5,540.52 points or 9.10% so far this year, the market capitalisation (m-cap) of all listed firms at its platform have jumped about ₹50.81 lakh crore.
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Global Context: India Among the $4 Trillion Club
The other markets valued more than $4 trillion of m-cap include the US, China, Japan and Hong Kong.
Investment Strategy Amidst Market Surge
Munger advised investors: don’t be gamblers, be patient investors. “There is a lot of gambling happening in the market now in low-grade stocks. These should be avoided. Investors should buy quality stocks which are fairly priced, and wait patiently. There is value in large-cap banking, IT and autos for patient investors. A big move in the market is likely after the state election results are known. Perhaps the exit polls tomorrow evening may provide some clues,” said Vijayakumar.
Market Updates: Sensex and Nifty Figures
At 11:50 am, the Sensex was trading 456.49 points, 0.69%, higher at 66,630.69, while the Nifty 50 was up 135.90 points, or 0.68%, at 20,025.60. At 1.21 pm the Nifty 50 was up 148.35 points or 0.74 points at 20,038.55.
Dovish Signals from US Federal Reserve Boost Indian Market
Dovish commentary from the US Federal Reserve official raised expectations of interest rate cuts next year, lifting sentiment for risky assets. “I am increasingly confident that policy is currently well positioned to slow the economy and get inflation back to 2%,” said Governor Christopher Waller, one of the most hawkish Fed officials.
Global Factors Influencing Indian Markets
Following the comments, the yield on the benchmark US 10-year Treasury note on Tuesday fell 2 basis points to 4.31%, while the dollar index fell to a more than three-month low of 102.57. Since the global market backdrop continues to be favourable, the rally in India is likely to continue. The drop in US 10-year bond yield to 4.3% and the dollar index dropping below 103 are positive for equity markets. FIIs have turned buyers responding to the changed reality,” said Vijayakumar.
