MUMBAI: A steep slide in crude oil prices globally, an overnight rally in the US
market and Chinese govt’s explicit support on Wednesday for the country’s battered stock market lifted investor sentiment globally. This also spilled over to Dalal Street on Wednesday which led to renewed buying that added a little over 1,000 points to the
sensex as it closed near the 57K mark after three weeks.
Since the sensex hit a seven-month low on March 7, the index has added nearly 4,000 points. Since that day, the sensex has risen on six sessions, the only exception being a 709-point slide on Tuesday. The day’s session added about Rs 4.6 lakh crore to investor’s wealth with BSE’s market capitalisation now at Rs 259.4 lakh crore, exchange data showed.
According to Siddhartha Khemka of Motilal Oswal Financial Services, domestic indices rebounded on back of positive global cues. “Global markets were positive after China’s government announced it would roll out stimulus to boost the economy post outbreak of fresh
corona
cases. Further, hopes of progress in the ceasefire negotiation between Ukraine and Russia lifted investors’ mood.”
In addition to the China factor, ease in FII selling and crude prices added strength to the domestic market, said
Vinod Nair
of
Geojit Financial Services
. The world equity market has stabilized factoring in a 25 basis points (100bps = 1 percentage point) hike in interest rate by the US Federal Reserve. “An in-line policy outlook will be a relief to the market and we may see a drop in volatility,” Nair wrote in a post-market note.
Market players also said that the strength of rupee after the fall in crude prices and reversal in foreign funds’ selling also added to the positive sentiment. After several weeks of unabated selling by foreign fund managers, on Wednesday, they showed a net buying figure of Rs 312 crore, BSE data showed. Along with the foreign fund managers, domestic institutional investors were net buyers at Rs 773 crore.
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