Equity markets saw a significant rebound on Tuesday, hitting a one-month high, with the Sensex surging 1,397.07 points to close at 78,583.81. This rally was fueled by easing global trade tensions and expectations of an interest rate cut by the Reserve Bank of India, boosting investor sentiment.
The Nifty 50 index also gained 378.20 points to end at 23,739.25, making a strong recovery from the previous session. The rally was widespread, led by banking and financial services stocks ahead of the RBI’s upcoming monetary policy meeting.
Vinod Nair, Head of Research at Geojit Financial Services, highlighted that India could outperform in a weak global market, leading to the surge in domestic equities. Large-cap stocks were favored, particularly banking stocks, amid anticipation of a rate cut in the upcoming RBI policy.
The financial services sector emerged as the top performer, gaining 2.11%, followed by banking stocks which rose 1.93%. Shriram Finance led the gainers with a 5.65% jump. On the other hand, Trent witnessed the steepest decline of 6.44%.
Market breadth remained positive, with more stocks advancing than declining on the BSE. Technical analysts were optimistic about the market’s trajectory, with the Nifty potentially moving towards 24,050. The Indian rupee also gained ground against the US dollar, trading at 87.08.
The upcoming RBI monetary policy meeting, under the new governor, and global trade developments will be closely monitored by market participants for further cues. Traders are advised to adopt a buy-on-dips strategy as long as the Nifty holds above 23,630.
