The Indian stock market witnessed a strong start to the week, with both the Sensex and Nifty indices demonstrating significant gains. The positive momentum was largely influenced by positive global cues and the Reserve Bank of India's (RBI) recent surprise rate cut.
The BSE Sensex surged by over 400 points, reaching 82,611, a 0.51% increase, while the NSE Nifty climbed above the 25,100 mark to 25,139, reflecting a 0.54% rise. This performance indicates a strong recovery and bullish sentiment in the market.
Several factors contributed to this surge. Optimism surrounding upcoming trade talks between the US and China in London boosted investor confidence. Additionally, the RBI's unexpected 50 basis point repo rate cut and a 100 basis point CRR cut provided further impetus, particularly benefiting rate-sensitive sectors.
Banking and auto stocks emerged as frontrunners in this rally. The Nifty Bank index hit a new all-time high, surpassing the 57,000 mark to reach 57,049.50. Major gainers in the banking sector included Kotak Mahindra Bank and Axis Bank. The Nifty Auto index also showed substantial gains, with Tata Motors, Maruti Suzuki, and Hero MotoCorp leading the charge.
Besides banking and auto, other sectors also contributed to the overall positive market sentiment. The Nifty PSU Bank index, Nifty IT, and Nifty Private Bank index all experienced notable gains, further diversifying the market's upward trajectory.
Broader market indices also reflected the positive sentiment, with the Nifty MidCap and Nifty SmallCap indices trading higher, indicating widespread participation in the market rally.
However, analysts have cautioned about potential profit booking in the near term, considering the recent sharp rally. Investors are now closely monitoring upcoming CPI and trade data, along with the progress of the 2025 monsoon, which has seen its earliest onset in 16 years. These factors are expected to influence market direction in the coming days.
From a technical perspective, the Nifty is showing signs of upward momentum after a period of consolidation. It is approaching a key resistance level of 25,100, and a successful breakout could signal further gains.
In terms of individual stock movements, MCX share price increased following approval from SEBI to launch electricity derivatives. Suzlon Energy's share price also saw a rise due to a block deal.
Overall, the Indian stock market is currently experiencing a phase of positive momentum, driven by a combination of global cues, policy support, and strong sectoral performance. While caution is advised regarding potential profit booking, the underlying sentiment remains bullish, with investors eyeing further upside potential.
