Sensex up 450 pts, Nifty near 22,700 – Check Factors behind market Rise

The market benchmark indices Sensex and Nifty climbed on Tuesday, extending their previous session’s rally, aided by buying in bank shares.

At around 11:10 am, the Sensex was up 446.78 points or 0.62 percent at 72,829.25, while the broader Nifty advanced to 22,691.70, up 135.95 points or 0.6 percent.

Both benchmarks had gained about 0.6 percent in the previous session after logging their longest weekly losing streak in 25 years, helped by lower oil prices and easing bets of aggressive US monetary tightening.

All Nifty sectoral indices gained, barring IT, FMCG and realty. The broader Nifty Smallcap 100 and Nifty Midcap 100 indices gained 0.8 percent and 0.5 percent, respectively.

Key factors behind market rise

1) Buying in bank shares: Financials, banks and private bank indices gained between 0.6 percent and 1.1 percent. Axis Bank rose 1.4 percent, while Kotak Mahindra Bank jumped 3.8 percent after the lenders reported a rise in quarterly advances and deposits.

2) Easing crude prices: Brent crude futures hovered near USD 101 a barrel after falling USD 2 overnight on increased Middle East oil exports and a G7 pledge to raise supplies.

“Indian equity markets are expected to remain broadly steady, with easing crude prices providing some support to market sentiment. WTI crude is currently trading around the USD 89–90 per barrel range after oil prices declined amid signs of improving crude shipments from the Middle East,” Ponmudi R, CEO of Enrich Money, an online trading and wealth-tech firm, said.

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3) Postive global cues: Asian equities also advanced, tracking the technology-led rally in the US and benefiting from the retreat in crude prices. MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.2 percent, while Japan’s Nikkei rose 0.7 percent. European equity futures climbed 0.5 percent.

US stock futures also edged higher, with Nasdaq futures up 0.2 percent and S&P 500 futures gaining 0.1 percent.

Wall Street ended higher in the previous session, led by technology stocks as Nvidia and Microsoft lifted the Nasdaq to a record closing high. The Nasdaq Composite gained 1.05 percent to 27,477.31, while the S&P 500 climbed 0.66 percent to 7,773.95. The Dow Jones Industrial Average rose 0.18 percent to 51,267.90.

“Positive overnight cues from global equities should support the opening, although the rise in the US 10-year Treasury yield to 5.31 per cent could limit follow-through by keeping foreign flows and emerging-market valuations under pressure,” Hariselvan Radhakrishnan, Founder & CEO of HST Wealth, a Research Analyst firm, said.

Among stocks, Trent surged about 10 percent after the apparel retailer projected a 23 percent year-on-year rise in standalone revenue for the September quarter.

Godrej Consumer Products gained 2 percent after projecting its second-quarter consolidated revenue to rise in the high-teens percentage.

Technical Outlook 

Anand James, Chief Market Strategist at Geojit Investments, said “We have pencilled in 23100-220 as the near-term objectives to aim for, with 22800 expected to pose intermediate challenge. Meanwhile, inability to push above the 22555-615 band today will signal the need for some more consolidation, but favoured view does not see a stretch beyond 22050 for now.”