Modi 3.0 hopes: Bulls return, as Sensex and Nifty50 recover with 2,300, and 735 pts
Virendra Pandit
New Delhi: With a third term of the Narendra Modi government likely to begin on June 8, and reformist Andhra leader N. Chandra Babu Naidu’s possible support to the NDA, the equity markets bounced back on Wednesday, trying to recover the unprecedented losses it suffered a day before.
The benchmark S&P Sensex and Nifty50 settled around 3 percent higher to close at 74,382 and 22,620 points, respectively, amid broad-based buying in the hope of political stability and potential economic reforms. Metal and banking stocks improved and most Adani group stocks gained.
During the Tuesday bloodbath, reports said, foreign institutional investors sold Rs.12,436.22 crore worth of Indian equities, while domestic institutional investors sold shares worth Rs. 3,218.98 crore.
Given the unexpected election results, which diverged from exit polls, traders should employ strict stop losses due to anticipated continued market volatility, analysts advised.
On Wednesday, the markets exhibited a spirited recovery driven by broad-based buying across various sectors. However, in the coming days, attention will be focused on the formation of the new government and the forthcoming RBI policy meeting.
However, the market does not expect any change in RBI’s policy stance given persistent high food inflation, and an expectation of an increase in government spending, which has led to notable traction in FMCG stocks.
