Mumbai: Today, on the last trading day of the week, the Indian stock market has made a strong and positive start. in the morning session Bombay Stock Exchange (BSE) major index of Sensex And National Stock Exchange (NSE) benchmark index of nifty A significant growth was recorded in both. This surge in early trading clearly reflects the positive sentiment and confidence among investors. Sensex It was seen trading at the level of 71,997.37, registering a solid gain of 404.13 points i.e. a jump of 0.56 percent. Similarly, nifty also made its debut at the level of 22,363.55, with an increase of 131.75 points or 0.59 percent.
The stock market which witnessed a huge all-round decline yesterday and nearly Rs 10 lakh crore of investors had lost money, has taken a new and positive turn this morning. Dalal Street But since this morning the ‘bulls’ (bullish investors) have tried their best to control the market. Due to the historic decline in the last trading session Sensex 32 more months nifty Had reached its lowest level in 18 months, after which a technical bounce-back is being seen today.
What was the main movement in the market this morning?
After yesterday’s severe fall, Indian stock markets opened with gains this morning. during opening hours bse sensex Jumped by about 338 points and was seen trading at the level of 71,930, while nse nifty 50 It also rose by about 91 points and crossed 22,323. This rise in the market is mainly due to ‘short covering’ i.e. buying at very low prices after yesterday’s heavy selling. If you understand in simple words, when the market falls more than necessary, then a natural improvement or recovery occurs in it, and today exactly the same trend is being seen in the market.
What are the reasons behind this sudden improvement in the market?
The biggest reason for this slight recovery is that after yesterday’s big fall, the Indian markets had come into the ‘oversold zone’ i.e. excessive selling. When stocks become too cheap, domestic institutional investors (DIIs) and traders start looking for new buying opportunities. Apart from this, the slight softening in the prices of crude oil in the international market as compared to yesterday has also provided some support to the domestic market.
What are the big factors that are putting brakes on the market rally?
Even though the market seems to be floating in the initial green zone today, its journey ahead may be full of challenges. There are mainly three big reasons behind this:
Crude oil and West Asia tensions: In the global market, Brent crude still remains at a high level around $ 104 per barrel. There is a constant fear of disruption in crude oil supplies due to ongoing tensions in West Asia. Since India imports more than 80 percent of its crude oil needs, expensive oil is the biggest challenge for our entire economy and stock market.
Indiscriminate selling by foreign investors (FIIs): Foreign institutional funds are continuously withdrawing their money from the Indian market. In the last session alone, foreign portfolio investors sold shares worth more than Rs 12,944 crore, one of the largest single-day sales in recent times.
Double pressure looming on IT sector: The quarterly results of the country’s major software companies have been somewhat weaker than expected, due to which there is an atmosphere of concern in the sector. Apart from this, the news coming out about a major labor program related to Green Card by America has also increased additional pressure on Indian IT companies.
What should be the right strategy for common investors?
Many financial experts of the market believe that today’s boom is mainly a ‘technical boom’ and it cannot be placed in the category of any permanent and strong improvement. Unless global crude oil prices calm down and continuous selling by foreign investors is stopped, the market will remain volatile. In such a situation, small and retail investors should avoid making big investments in a hurry. At this point of time, it would be wisest to keep an eye on only selected stocks with strong fundamentals.
