Sensex surges by 1,600 points, Nifty makes strong recovery; FMCG and auto stocks drive rally
PTC News Desk: During Wednesday's intraday trade, benchmark stock market indices saw a significant increase, with the S&P BSE Sensex and NSE Nifty50 each rising by more than 2%.
The increase followed the greatest stock market meltdown in four years on Tuesday, when Dalal Street investors lost hope over the outcome of the Lok Sabha election.
At 11:37 am, the Nifty50 had gained 508.40 points to trade at 22,392.90, while the Sensex had gained 1,651.25 points to 73,730.30.
The stock indices both saw significant gains in today's early trading. Nevertheless, strong selling pressure amidst volatility eroded profits, and analysts forecast bumpy trading in the near future as a result of the surprising outcomes.
The broader market indices also experienced a significant increase, led by robust advances in Nifty Small- and Mid-cap equities. This was caused by a significant decrease in volatility, as seen by the India VIX falling by 28%.
A remarkable rise in FMCG and auto stocks was the main driver of the gains, but the IT, financial services, and high-weighted banking sectors all saw gains.
Hero MotoCorp, HUL, M&M, Tata Consumer Products, and Asian Paints were the top gainers on the Nifty50
In contrast, L&T, Grasim, BPCL, Power Grid, and SBI were the biggest losers.
Experts in the stock market have advised investors to exercise caution despite the current market rise.
Mehta Equities Ltd.'s Senior VP (Research), Prashanth Tapse, stated: "Markets are expected to remain volatile in the short term, even as the NDA-led BJP is set to form the government for the third time, making history."
"Given the known factors, it's advisable to allow some time for the markets to stabilize following the unexpected election outcome," Tapse said.
"Traders and investors should be cautious and consider focusing on defensive and non-government-driven sectors such as FMCG, Telecom, and Pharma stocks."
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- With inputs from agencies
