It’s a buoyant session for our markets today. The benchmark indices are sailing steady, led by tech sector stocks. The Nifty has breached the psychologically important 25,900 mark, while the Sensex has clocked over a 700-point gain thus far in today’s session. The small and the midcaps too are buzzing in today’s session. The BSE Small Cap Index is up 0.7% while the Nifty Midcap Index gained 0.6%.
But what’s contributing to the positive sentiment? Market veteran Deepak Jasani highlighted that “the markets are buoyant today on the back of two key factors. The Bihar exit polls have helped lift investor sentiment. Moreover, the commentry from both the US and India seems to suggest that one can expect some clarity on the India-US trade deal in the near term. That’s also making investors turn positive and boosting overall risk appetite in the market.”
Dr VK Vijayakumar, Chief Investment Strategist, Geojit Investments, reiterated the sentiment and highlighted the key triggers include, “news of an India-US trade deal getting finalised soon and the exit polls indicating a decisive victory for the NDA in Bihar. This will strengthen the bulls but is not good enough for the markets to stage a decisive breakout and sustained rally. Going by the present trends, FIIs are likely to sell again at higher levels. So long as the AI trade continues a sustained reversal of FII money appears unlikely.”
3 reasons why the markets are rising today
Overall sentiment is positive in the markets today, with the new listings holding on to their early gains. For the broader market 3 key factors are supporting investor sentiment at the moment –
Bihar Exit Polls
The markets are waiting for the Bihar Election results keenly. With 12 JDU MPs in the central NDA coalition, the outcome of the Bihar election is a key deciding factor in terms of Policy continuity and the continued strength of the Govt at the Centre. Based on the present exit poll trends, there are indications that the National Democratic Alliance (NDA) may put up a strong performance in the state assembly elections. The market is reading this as a positive indication, as the NDA maintaining the status quo in terms of the power equation would signal policy continuity at the Centre.
US-India trade talks
The market is also responding positively to signs of positive momentum in India-US trade talks. According to the latest on PTI, an Indian trade official was quoted onTuesday that New Delhi is awaiting Washington’s response for an agreement. The remark follows US President Donald Trump’s comments that the US is getting close to a trade deal with India.
Tech stocks lead the charge
The Nifty IT Index is up over 2%. The top gainers include the likes of TCS, LTI MindTree, Tech Mahindra and the like. The tech sector got a leg up on indications of positive development in terms of the progress in US-India trade talks. The rupee’s softness also helped sentment.