Indian Stock Market Surges as Foreign Investors Return
The Indian stock market opened on a positive note this Monday, with both the BSE Sensex and Nifty50 indices showing significant gains. The BSE Sensex climbed back above the 77,000 mark, while Nifty50 surpassed 23,500. This upward trend follows a robust performance last week, marked by the Nifty50’s highest weekly gains in four years, driven by increased foreign institutional investor activity.
Strong Market Performance
At 9:16 AM, the BSE Sensex was trading at 77,449.15, reflecting an increase of 544 points or 0.71%. Meanwhile, Nifty50 reached 23,507.70, up by 157 points or 0.67%. The previous week concluded on a high note, with the Nifty50 achieving its most substantial weekly gains since 2019. Analysts attribute this surge to a resurgence in foreign investor participation and a shift in market sentiment, indicating a potential end to the recent downturn.
Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services, noted that the Nifty has rebounded by 6.3% over the past three weeks, suggesting a trend of value buying at lower levels. He expressed optimism about the continuation of this upward momentum, citing the return of foreign institutional investors to the Indian market, driven by attractive valuations and signs of economic recovery.
Technical Indicators Favor Growth
The Nifty50’s upward trajectory is supported by a recent trendline breakout, which has bolstered positive market sentiment. Rupak De, Senior Technical Analyst at LKP Securities, highlighted that the index faced resistance at the 21-week exponential moving average of 23,382 during the previous trading session. This technical analysis suggests that the market may continue to experience upward movement if it can maintain momentum above these key levels.
In the broader context, U.S. markets also showed signs of recovery, with the S&P 500 and Dow Jones posting marginal gains on Friday. This recovery followed comments from U.S. President Donald Trump, indicating that upcoming tariffs might be less severe than initially expected, further boosting investor confidence.
Foreign Investment Trends
On Friday, foreign portfolio investors made net purchases amounting to Rs 7,470.36 crore, while domestic institutional investors sold shares worth Rs 3,202.26 crore. This shift in investment dynamics underscores the growing confidence among foreign investors in the Indian market, as they capitalize on favorable economic indicators and valuation opportunities. Crude oil prices remained stable on Monday as market participants closely monitored potential outcomes from ceasefire negotiations between Russia and Ukraine. A successful resolution could lead to increased Russian oil supply in global markets, further influencing market conditions.
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