Sensex And Nifty Hit All-Time Highs Amid Expectations Of Modi’s Victory

The stock market saw a historic surge at the start of the week, hitting record highs fueled by optimistic investor sentiment following exit polls predicting a clear victory for the BJP-led NDA coalition. This surge saw the Sensex climb by 1859.88 points to open at an unprecedented 75,821.19, while the Nifty made a significant jump of 603.85 points, starting the day at 23,134.55. What made this market performance particularly noteworthy was that all 50 companies in the Nifty index witnessed gains, signaling a robust and rare market scenario.

Leading the charge were notable performers like Adani Ports, Adani Enterprises, Power Grid, Shriram Finance, and NTPC, all of which contributed significantly to the market rally with substantial gains.

The positive mood in the market was further buoyed by India’s impressive Q4FY24 GDP growth of 7.8 per cent, surpassing expectations and bringing the fiscal year’s growth to a sturdy 8.2 per cent. “Buoyant sentiments are driven by India’s impressive Q4FY24 GDP growth of 7.8 per cent, surpassing expectations, with the fiscal year’s growth standing at 8.2 per cent,” remarked Varun Aggarwal, founder and managing director of Profit Idea. However, Aggarwal also noted the potential for market volatility as the final election results draw near.

This optimism wasn’t limited to Indian markets alone; Asian markets echoed this positive trend, spurred by China’s strong manufacturing data performance. The Kospi in Korea surged by 1.49 per cent, Japan’s Nikkei rose by 1.13 per cent, and Australia’s ASX200 gained 0.82 per cent. In the US, the Dow Jones and S&P 500 closed 1.51 per cent and 0.80 per cent higher, respectively, although the Nasdaq experienced a slight decline.

Expectations of imminent rate cuts have been heightened following a softer reading of the Federal Reserve’s preferred inflation measure, further boosting Asian equities.

However, potential sources of volatility still loom, including geopolitical tensions and the dynamics of the US election, which could impact global markets significantly.

Simultaneously, oil prices are on an upward trajectory, reflecting robust investor confidence as evidenced by the overwhelming demand for Saudi Aramco’s $12 billion share sale.

In Mexico, Claudia Sheinbaum’s projected win for the ruling party Morena suggests continuity in governance, a development positively received by markets.

Looking forward, market participants eagerly anticipate key economic indicators such as inflation prints across emerging markets and growth data from various regions. The European Central Bank’s upcoming policy meeting and the release of the US jobs report will be pivotal in providing further market insights.

The convergence of positive domestic and international economic data, combined with favorable political forecasts, sets the stage for a dynamic and potentially volatile trading period as the final election results draw near.

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