The BSE Sensex rallied over 500 points intraday on Wednesday on the back of buying in several blue chip stocks, after the release of better than expected macroeconomic data. Sensex surged 481.16 points to close at 25,626.75, while Nifty reclaimed 7,800 mark by climbing 141.50 points to 7,850.45.
Below are 4 reasons why Sensex rallied over 500 points intraday today:
1. Sentiments also got a boost from the Met department prediction that said after two consecutive drought years, the country will receive “above normal” monsoon with a fair distribution of rainfall across major parts of country and it will be a “good year”.
2. Indian rupee was trading up by 6 paise to 66.43 against the US dollar in the late trade, according to RBI website.
3. Asian equity markets ended higher on Wednesday, with sentiment bolstered by a weak yen, an overnight rally in oil prices and upbeat Chinese trade data.
4. Stock markets also got a boost on good macroeconomic data that came on Tuesday. Industrial production grew at 2 per cent in February after remaining negative for three months and retail inflation dropped to a 6-month low of 4.83 per cent in March, reflecting some improvement in the economy and offering further scope to RBI to stay accommodative.
5. Support also came with the International Monetary Fund’s latest World Economic Outlook report, which despite cutting global growth forecast has said that India’s growth is projected to notch up to 7.5 per cent in 2016-17, overtaking China’s GDP by more than 1 per cent, mainly driven by private consumption and increased industrial activity.