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Market salutes PM Modi’s third term: Sensex-Nifty open at all-time high

Indian stock indices continued their uptrend from the past week and opened at fresh record highs at the opening bell on Monday, a day after Prime Minister Narendra Modi and his Union Council of Ministers took oath to office. A smooth transition in the government formation seemed to have boosted market sentiments.

At the opening bell, the Sensex surged to an all-time high of 76,960.96 points, while the Nifty touched a record 23,411.90 points. At the time of reporting, the Sensex was trading at 76,890.34, up 0.3 percent, and the Nifty stood at 23,372 points, an increase of 0.4 percent. Most sectoral indices were in the green, reflecting the overall bullish sentiment.

As the week progresses, analysts believe investors will closely monitor the upcoming US Federal Reserve interest rate decision, India’s inflation data (both retail and wholesale), and the decisions of the new government. The allocation of ministry portfolios to the newly sworn-in ministers will also be keenly tracked by the markets.

India’s retail inflation eased to 4.83 percent in April, down from 4.85 percent in March. However, consumer food price inflation surged to 8.70 percent from 8.52 percent last month. While the retail inflation in India is within the Reserve Bank of India’s (RBI) 2-6 percent comfort level, it remains above the ideal 4 percent scenario.

“Global cues, particularly the upcoming US Fed meeting, will be closely watched by participants. The recovery following the post-election decline suggests resilience among participants, and we expect the prevailing tone to continue,” said Ajit Mishra, SVP, Research, Religare Broking Ltd.

The renewed participation of sectors like IT and FMCG, which were previously on the sidelines, supports the confidence in the market’s upward trajectory. However, traders should remain cautious and focus on stocks that are moving in line with the benchmark indices.

“Next week’s focus will be on the allocation of key cabinet portfolios such as Finance, Defense, Roads, Energy, Commerce, and Railways. The market will continue to be volatile with an upward bias,” said Siddhartha Khemka, Head – of Retail Research, at Motilal Oswal Financial Services Ltd.

The market’s euphoric performance comes after a roller-coaster ride last week, when the indices witnessed a bloodbath on the day the Lok Sabha results were announced. However, the losses have been recovered, and the indices have regained their record highs, driven by the aggressive buying power and optimism of domestic institutional investors and retail investors.

(Inputs from ANI)

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Last Updated: 19th Jun 2024