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Strong global handover, coupled with healthy January-March quarter (Q4FY23) results, propelled markets higher in Monday's intra-day trade. The S&P BSE Sensex recouped 817 points, or 1.3 per cent, from Friday’s low to claim the day's high of 61,832 levels, whereas the NSE Nifty index recovered 224 points, or 1.2 per cent, to hit an intra-day high of 18,279 levels.
Broader indices, too, were upbeat in Monday’s trading session, as the Nifty Midcap 100 and Nifty Smallcap 100 indices surged up to 0.9 per cent.
Sectorally, Nifty Realty index was the top performer, as it gained over 2 per cent. The Nifty Bank and Auto indices were the other leaders in trade, rising over 1 per cent each.
On the flipside, the Nifty PSU Bank and Media indices were the top laggards, slipping up to 1 per cent.
Analysts list upbeat US jobs data in April, and persistent foreign institutional investor (FII) buying as some of the key reasons behind this upside.
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"Support from global markets and sustained FII buying can revive positive market sentiments, which were impacted by heavy delivery selling of Rs 4,500 crores in HDFC twins last Friday. Cues from the mother market US indicate that the fears from the regional banking crisis are receding. The April US jobs data, which came at a much better-than-expected, reflects a strong economy which may even avoid a recession," said Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Meanwhile, here are the top factors behind the market's bull run:
Firm global cues: Stronger-than-expected April employment report bolstered US markets which snapped their four-day losing streak on Friday, as it tempered fears of recession. Dow Jones, NASDAQ Composite, and the S&P 500 indices surged in the range of 1-2 per cent.
According to the Bureau of Labor Statistics, total non-farm payroll employment rose by 2,53,000 in April, ahead of economists’ forecast of 1,85,000 new job additions.
Asia-Pacific markets, too, largely rose this morning, with the S&P 200, Kospi, Hang Seng, and Shanghai Composite indices rising up to 1 per cent.
Strong Q4 results: A slew of solid Q4FY23 results supplemented strength in overall markets. Shares of Britannia, Marico, Paytm, Union Bank, and Adani Power, surged in the range of 1 per cent to 9 per cent in Monday's intra-day trade, after these companies reported strong Q4FY23 results.
Sustained FII buying: From the past six trading sessions, FIIs have bought over Rs 16,200 crore worth of equities. Domestic institutional investor (DII) activity, however, remained mixed, during the same period. Analysts believe rupee appreciation is triggering foreign fund flows into India.
Rupee strengthens: The domestic currency appreciated 8 paise to 81.70 against the US dollar in Monday’s early trade, tracking weakness in the dollar index. The dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.07 per cent to 101.14 as investors cling hopes for a dovish US Federal Reserve.
