MUMBAI: The sensex snapped a four-day losing streak and staged a comeback rally on Monday, surging 721 points or 1. 2% to 60,566 — the largest single-session gain in over a month. On Friday, the sensex had recorded its worst one-day fall in three months with a nearly 1,000-point dive, closing below the 60k milestone.
Justlike the crash on Friday, the recovery rally too was driven by global cues, market analysts said. Discount hunters took advantage of the sudden drop — the frenzied selling on Friday had pulled the sensex down to a nearly 2-month low — market watchers said. “The pullback rally came amid optimistic sentiment from global indices. European markets were closed for the Christmas holiday. Asian markets ended in green amid signs that US inflation may be receding,” Mohit Nigam of Hem Securities said. However, volatility is expected to remain elevated in the near term. “The market was refuelled by bottom-fishing. Public sector banks led the rally, while midand small-cap stocks outpaced the benchmark. Contrary to the trend, global concerns over the recession and spread of Covid remain high, which will sustain volatility,” Vinod Nair, head of research at Geojit Financial, said.
Investor wealth rose by more than Rs 5. 7 lakh crore on Monday, after a Rs 8. 5lakh-crore wipeout on Friday. The BSE’s market capitalisation now stands at just over Rs 281 lakh crore, which is about Rs 14 lakh crore short of the all-time high of nearly Rs 295 lakh crore hit on December 14. The rise on Monday came despite foreign investors net-selling stocks worth about Rs 500 crore. Domestic institutional investors net-bought about Rs 1,286-crore stocks on Monday, provisional data from the BSE showed.
Analysts added that investors should make use of dips to acquire stocks in the current expensive valuation scenario. External factors like the Covid surge in China and impact of rate hikes by central banks are expected to weigh on investor sentiment in the medium term, thus ensuring market volatility. The equity gains also led to the rupee strengthening on Monday, with the domestic currency appreciating by 21 paise to 82. 65 against the dollar.
Justlike the crash on Friday, the recovery rally too was driven by global cues, market analysts said. Discount hunters took advantage of the sudden drop — the frenzied selling on Friday had pulled the sensex down to a nearly 2-month low — market watchers said. “The pullback rally came amid optimistic sentiment from global indices. European markets were closed for the Christmas holiday. Asian markets ended in green amid signs that US inflation may be receding,” Mohit Nigam of Hem Securities said. However, volatility is expected to remain elevated in the near term. “The market was refuelled by bottom-fishing. Public sector banks led the rally, while midand small-cap stocks outpaced the benchmark. Contrary to the trend, global concerns over the recession and spread of Covid remain high, which will sustain volatility,” Vinod Nair, head of research at Geojit Financial, said.
Investor wealth rose by more than Rs 5. 7 lakh crore on Monday, after a Rs 8. 5lakh-crore wipeout on Friday. The BSE’s market capitalisation now stands at just over Rs 281 lakh crore, which is about Rs 14 lakh crore short of the all-time high of nearly Rs 295 lakh crore hit on December 14. The rise on Monday came despite foreign investors net-selling stocks worth about Rs 500 crore. Domestic institutional investors net-bought about Rs 1,286-crore stocks on Monday, provisional data from the BSE showed.
Analysts added that investors should make use of dips to acquire stocks in the current expensive valuation scenario. External factors like the Covid surge in China and impact of rate hikes by central banks are expected to weigh on investor sentiment in the medium term, thus ensuring market volatility. The equity gains also led to the rupee strengthening on Monday, with the domestic currency appreciating by 21 paise to 82. 65 against the dollar.
