After worries about a global banking crisis subsided, investors increased their willingness to take risks, which resulted in gains in domestic markets for the third day in a row.
The benchmark index, the Nifty, increased by more than 250 points, or 1.6%, to a 50-day high of 17,356, while the S&P BSE Sensex increased by more than 900 points, or 1.6%, to 58,941.
After the conglomerate decided to separate its financial services unit from the conglomerate, index-heavyweight Reliance Industries saw its overall gains largely pared as shares rose more than 4% in intra-day deals.
In addition, the larger markets displayed strength as small-cap stocks outperformed frontline indices.
However, given that the markets will experience data-driven movements in the coming days, analysts remain cautious regarding the sustainability of this recent rally.
“In the past two days, foreign institutional investors (FIIs) have become buyers because nifty valuations are now reasonable. The market is oversold and this could prompt short-covering and a strategic meeting in the close to term. However, given that FIIs will once more turn sellers at higher levels, a sustained A rally is unlikely. Coming days will see a ton of information or news driven market action. “The January-March results season (Q4FY23) beginning on April 13 and the RBI decision on interest rates on April 1 will trigger stock price movement,” stated Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
In the meantime, the following are the top five reasons why the market moved on Friday:
Strong Global Signals: After concerns about the banking crisis were eased by renewed buying in technology companies, US markets extended their winning streak for a second day in a row. Overnight, the Nasdaq Composite, S&P 500, and Dow Jones all experienced gains of up to 0.7%. Expectations of a slowdown in monetary policy tightening have also been raised by an increase in weekly claims for unemployment benefits.
On Money Road, following positive moves in Asia-Pacific business sectors additionally shut higher toward the beginning of today. The Nikkei 225, Topix, S&P 200, Kospi, and Hang Seng major indices all experienced increases of up to 1%.
Rupee strengthens: The rupee appreciated by 24 paise to 82.1 in early trade on Friday on strong global cues and foreign inflows. The dollar index, which gauges the greenback’s strength against six major currencies, meanwhile rose 0.05 per cent to close at 102.2.
In their daily note, analysts at ICICI Securities stated, “We expect Nifty to resolve last 12 sessions’ upper upper band of 17,200-16,800, paving the way for a gradual up move towards 200 days-EMA placed at 17,500.” After a close approach to the lower band of a four-month descending channel, global negative news.