The benchmark equity indices are on a rising spree tracking global euphoria over progress in US-China trade and likely Conservative Party win in UK general elections.
The benchmark equity indices are on a rising spree, tracking global euphoria over progress in US-China trade and likely Conservative Party win in UK general elections. While Sensex was trading at 41,006.91, up 425.20 points, or 1.05%, Nifty was 12,076.60, up 104.80, or 0.88% at the time of reporting. In the previous session, the 30-share gauge ended 169.14 points, or 0.42 per cent, higher at 40,581.71, while the Nifty settled 61.65 points or 0.52 per cent, up at 11,971.80.
The US and China are close to finalising a modest trade agreement that would suspend tariffs that are set to kick in Sunday, de-escalating their 17-month trade war. “The expectation of both recovery of some nclt cases and the trade agreement between US and China are leading to a rise in equities today. Clarity on brexit due to UK election results is also soothing investors nerves. Any further measures by the govt to ease liquidity to the stressed sectors of the economy will further provide flip to the market,” Abhimanyu Sofat, Head Research, IIFL told Financial Express Online.
The other Asian stock markets are also trading on a positive note following positive global developments. Hang Seng, Nikkei and Shanghai also gained up to 2.50 per cent in today’s intraday trade. “Global markets are welcoming the end of the US- China trade hostilities. As the US market has boomed, so have markets around the world, and India has clearly joined the euphoria. But some words of caution- if we are now benefiting from external positive news so quickly, it would equally be the case on the negative side, unlike the natural buffer we had in the days of the Global Financial Crisis. If we are getting so correlated it has far reaching implications for our markets across asset classes,” Ranjan Chakravarty, Product Strategist, Metropolitan Stock Exchange (MSE) told Financial Express Online.
“By the time the NIFTY tested the lower end of the congestion zone near 11830, the index had got oversold on the shorter time-frame. This coincided with a positive global setup which was supported by the Federal Reserve keeping the rate unchanged. This weakened the US Dollar a bit and the emerging markets benefited from this. Coming back to the NIFTY, the bulk of the move that we are witnessing is being supported by this positive risk-on setup. However, at this stage, we can just broadly call this a technical pullback as the NIFTY is yet to take out its double top resistance at 12103 on a closing basis despite making incremental highs…” Milan Vaishnav, CMT, MSTA, told Financial Express Online.