Hey everyone,
We’re halfway through the week, and it looks like the Indian stock market finally hit the caffeine after dozing off for three straight sessions. The bulls are back, and they’re making noise.
If you’ve been tracking your portfolio with one eye and clutching your SIPs with the other, today’s update might just bring a sigh of relief.
Let’s break it down…
📌 The market is finally rebounding
After a sluggish start to the week, the Indian stock market came alive on Wednesday.
The Sensex opened at 81,327.61 and surged over 800 points to touch an intraday high of 82,021.64. That’s a healthy 1% jump.
Meanwhile, the Nifty 50 wasn’t left behind. It kicked off at 24,744.25 and rose over 1% as well, reaching an intraday high of 24,946.20.
Midcap and Smallcap indices joined the rally too, rising by close to a percent.
And btw: investors got richer by ₹4 lakh crore in a single day as the total market cap of BSE-listed companies swelled to nearly ₹442 lakh crore.
📌 What’s fueling this rally?
There are five key reasons markets are riding high today:
1. The market’s initial loss helped a lot
After the market went down for three days straight, losing about 2%, it was kind of like a “sale” for investors. Prices of many big, important stocks dropped to levels that looked too good to ignore.
Traders who had been betting that prices would keep falling (called “short sellers”) started buying those stocks back quickly to close their bets and avoid bigger losses.
This rush of buying helped push the market back up. So basically, after a few days of dips, the market was ready to bounce back, and these traders helped kick-start the rally.
2. Then, the dollar weakened
The value of the US dollar went down a bit about half a percent.
When the dollar becomes weaker compared to other currencies, it usually makes investing in countries like India more attractive for international investors.
Why?
Because when the dollar is weaker, their money can go further when converted to local currencies, meaning they can buy more stocks for less. So a weaker dollar often leads to more foreign money flowing into the Indian stock market, giving it a nice boost.3. A strong domestic sentiment
Even though the market had a recent dip, investors still feel good about India’s economy.
Experts from SBI say India’s economy is expected to grow at around 6.4 to 6.5% in the last quarter of the financial year. That’s pretty solid growth!
Plus, inflation (how much prices for goods and services rise) dropped to its lowest point in six years in April.
Lower inflation is good news because it means people’s money stretches further and costs aren’t rising as fast.
This has led many to expect that the Reserve Bank of India (RBI) might cut interest rates two more times this year, each by 0.25%. Lower interest rates usually encourage borrowing and spending, which is great for businesses and the stock market.
4. The buzz around US-India trade deal is also helping
There’s a lot of talk about a possible trade deal between the US and India.
If it happens, it could be a big deal for Indian businesses because it might make it easier to export goods and services to the US, one of the biggest markets in the world.
Just the possibility of this deal has made investors more willing to buy stocks. However, until the details are clear and the deal is signed, there could still be ups and downs in the market as people react to news and rumors.
5. Technical Support is also holding strong
In stock market terms, “technical support” means a price level where the market tends to find buyers and stops falling further.
Recently, the Nifty 50 index dropped below the 24,800 level but stayed above 24,400. Experts say as long as Nifty stays above 24,400, it’s a sign the market is still healthy and likely to move up from there.
But they also suggest caution. So, it’s better to be selective about which stocks to buy right now instead of jumping in aggressively.
Markets are like moods; ups and downs are inevitable. The trick is to stay informed and stay calm.
So, that’s it for today. If you enjoyed this edition, subscribe to hear from us every day!
See ya 👋
