The sectors that are sensitive to interest rates saw the biggest gains. Nifty Realty was at the top with a 6.75 percent rise, followed by Nifty Auto with 6.69 percent and Bank Nifty with 5.67 percent.
After the US and Iran agreed to a two-week ceasefire and the Strait of Hormuz was opened for commercial oil and gas supply, the market did very well. It traded strongly all day and rose almost 4% on April 8. The RBI’s decision to keep things the same has also helped the financial sector. So, this positive market mood led to an increase in investors’ wealth of almost Rs 17 lakh crore in one session and Rs 34 lakh crore in April…
The long-awaited announcement of the ceasefire brought a lot of relief to all asset classes. Oil prices dropped below $100 a barrel, and the risks of earnings downgrades and inflation also went down.People see the temporary ceasefire as a step toward more stability in the region as a whole. Vinod Nair, Head of Research at Geojit Investments, said that the reopening of the Hormuz Strait is good for India right away because it has lowered oil prices below $100 a barrel and lowered the risks to FY27 EPS growth.
Vinod Nair thinks that the rally still has room to continue in the near term, even though the outlook for Q4 results is still weak. Investors are focusing on reasonable valuations and a stable medium-term earnings trajectory.
The benchmark indices started the day with 3 percent gains and stayed positive all day, closing at 77,563, up 2,946 points (3.95 percent—the biggest single-day rally since February 1, 2021). The market breadth was mostly bullish, with seven shares going up and one going down on the BSE.
On Wednesday, the BSE market capitalization rose to Rs 445.51 lakh crore, up Rs 16.83 lakh crore from Rs 428.77 lakh crore in the previous session. This was thanks to a sharp rally that was supported by all sectors. In April, the market cap rose by almost Rs 34 lakh crore, going from Rs 411.55 lakh crore on March 30, the day it hit a bottom after the recent steep drop caused by the West Asia war.
Investors lost Rs 56.71 lakh crore since the start of the Middle East war, which cut off oil supplies from the Strait of Hormuz and raised global growth risks.
On the BSE, more than 400 stocks hit the upper circuit, and almost 100 stocks reached a 52-week high.
The Nifty 50 rose 874 points (3.78 percent) to 23,997, bringing the total gains to 8 percent from the April low. The Nifty Midcap and Smallcap 100 indices each rose more than 4 percent.
Nifty Realty had the biggest gains, up 6.75 percent, followed by Nifty Auto (6.69 percent) and Bank Nifty (5.67 percent). This was because the Reserve Bank of India decided to keep the repo rate at 5.25 percent with a neutral stance, which was seen as good for stocks.Ajit Mishra, SVP of Research at Religare Broking, said, “The sharp rally is encouraging, but it will depend on continued follow-through buying and stability in crude oil prices and global cues.”
At the same time, the 10-year bond yield has dropped significantly (by 1.9 percent to below 7 percent), and the rupee has gained 0.57 percent to 92.61 (at the time of writing this article). The currency rose sharply in the last few weeks, especially from its all-time low of 95.23 on March 30.
Brent crude prices, which are the standard for oil prices around the world, were trading at $93.01 a barrel, down 10.07 percent (at the time of writing this article). This was after the ceasefire announcement caused the market to open lower.
Donald Trump, the President of the United States, has stopped attacks on Iran for two weeks. However, this is only if Tehran lets ships safely pass through the Strait of Hormuz, which is the waterway that supplies 20% of the world’s oil. Trump said that Iran had sent the US a 10-point proposal that could be used as a starting point for talks.
“Almost all of the different points of disagreement between the US and Iran have been worked out, but the agreement will be finalized and carried out over the next two weeks,” Trump wrote on social media. Iranian Foreign Minister Seyed Abbas Araghchi said that Tehran will allow safe passage through the strait during the ceasefire “in coordination with Iran’s Armed Forces and with due consideration to technical limitations,” according to CNBC.
