Sensex surges record 2,476 points on global cues

MUMBAI: A strong market rally across the globe on slowing daily coronavirus infection numbers, talk of a phased exit from the lockdown in India, expectations of foreign fund inflow aggregating $1.3 billion into the country after MSCI rejigs its indices and some short covering by speculators combined to lift sensex by 2,476 points on Tuesday, its biggest-ever single-session points gain, to close at 30,067. The day’s gains came on the back of strong buying in heavyweights like RIL, HDFC Bank, ICICI Bank, Infosys and HUL, BSE data showed.
The day’s 9% gain was the sensex’s biggest percentage rise since May 18, 2009 when it had closed almost 20% higher after Manmohan Singh was re-elected to lead UPA-II government at the Centre. Tuesday’s rally also added about Rs 8 lakh crore to investors’ wealth with BSE’s market capitalisation now at Rs 115.8 lakh crore.
Wall Street rally boosts Asian markets’ opening
On Monday, the Dow Jones and S&P500 indices on Wall Street had each rallied over 7% after data showed slowing growth of the spread of the pandemic across the US and Europe. This led to a strong opening for Asian markets on Tuesday with Dalal Street getting an additional boost from indications from the government that it may partially relax lockdown rules for districts where the virus has not spread.
According to Gaurav Dua, senior VP, head — capital market strategy & investments, Sharekhan, the daily addition has dropped to below 10% levels in the last couple of days and is showing flattening of curve in hotspot countries like Italy and Spain.
“Along with this, the weightage of India in the MSCI Emerging Market index is expected to increase by 55 basis points (100 basis points=1 percentage point), which means possible inflows of $7 billion into some large-cap companies,” Dua said. On Tuesday evening too, the rally in Dow Jones and S&P500 indices continued with European markets too joining in. According to a note by Angel Broking, the Nifty, which closed at 8,792 points, is now most likely to head towards the 9,000-9,050 level and then if the strong buying continues, could break above that mark. “Looking at today’s sharp broad-based move, we will not be surprised to see the Nifty marching towards 9,200–9,400 levels. On the flipside, 8,550-8,360 level now becomes a sacrosanct support for a while,” the note said.

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