The Indian financial markets extended their rally with the benchmark indices finishing on a positive note for the third straight session amid global market optimism. Tuesday’s trading session saw the Nifty conclude at 22,368, marking a slight increase of 0.14 percent. Following a slump to 21,777, a rapid recovery ensued with the Nifty bouncing back by a formidable 670 points, as recounted by Devarsh Vakil, Deputy Head of Retail Research at HDFC Securities.
A noteworthy trend was observed in the final hour of trading, where the Indian markets relinquished much of the day’s earlier gains, only to settle modestly higher. This closure signified a continuation in the growth trajectory for three consecutive sessions. In alignment with this upward trend, the Nifty Midcap 100 and Smallcap 100 Indices outshone the primary Nifty index with increases of 1.06 per cent and 1.23 percent, respectively. The Nifty Smallcap Index in particular achieved a new milestone, reaching an all-time high at 16,702 points. This was accompanied by a bullish sentiment wherein the number of advancing shares for the second day in a row surpassed those on the decline.
Examining the composite gains within the sectoral space, Nifty Realty, Fast Moving Consumer Goods (FMCG), and Consumer Durables sectors showed the most notable advances. However, on the flipside, sectors such as Nifty Media, Information Technology, and FMCG experienced some of the highest losses during the session.
Parallel to these market dynamics, India’s overall economic picture continued to shine. Economic activity in the country grew throughout the month of April, fueled by robust performance in both the services and manufacturing sectors. Supporting this strong economic landscape, the flash India Composite Purchasing Managers’ Index (PMI) saw an increase from the final reading of 61.8 in March to 62.2 in April, signalling further expansion and a healthy economic momentum.
Neeraj Sharma, the Assistant Vice President for Technical and Derivatives Research at Asit C Mehta Investment Intermediates, contributed to the narrative by stating that domestic equity benchmarks have witnessed a streak of growth for three successive days, invigorated by optimistic currents from international market trends.
An additional aspect of the financial milieu was the movement of the volatility index, known as India VIX, which experienced a substantial decrease of 19.72%, settling down at 10.20 and indicating an environment of low volatility in the marketplace.
Reiterating the day’s achievements, the sectoral indices continued to show divergent performances. Nifty Reality, FMCG, and Consumer Durable sectors repeated their stellar showing, whereas Nifty Media, IT, and FMCG sectors lagged, reflecting a mix of sector-specific challenges and market adjustments.
The expansive growth of India’s economy in April, as reflected by the PMI data, further reinforced the positive sentiment in the markets. The commitment of the services and manufacturing sectors played a significant part in sustaining this uptrend.
To encapsulate the day’s eventful market activities, Neeraj Sharma echoed his earlier comments, emphasizing the continued rise of domestic equity benchmarks. The steady trajectory bolstered by the favorable outlook on global markets, and the notable decrease in market volatility appeared as clear indicators of the prevailing investment climate, offering a promising vista for economic progress and prosperity.
