Stock markets soar 3% as political stability reigns

Mumbai, June 8: Indian stock indices witnessed a surge of over 3% amidst a week marked by political twists, ultimately buoyed by the return of Prime Minister Narendra Modi for an unprecedented third term and significant monetary policy announcements by the Reserve Bank of India (RBI).

Both the BSE Sensex and the Nifty soared to new heights, with the Sensex hitting an all-time high of 76,795.31 and the Nifty reaching a record peak of 23,338.70.

Friday saw the Sensex surging by 2,732 points or 3.69% to conclude at 76,693.36, while the Nifty rose by 759 points or 3.37% to settle at 23,290.

The investor sentiment, which had been shaky amid political uncertainties, rebounded swiftly post the formation of the new government, witnessing a recovery of over Rs 28 lakh crore in just three trading sessions.

Throughout the week, the BSE Small-cap index and Mid-cap Index surged by 3%, mirroring the upward trend of the large-cap Index.

Foreign institutional investors (FIIs) offloaded equities worth Rs 13,718.42 crore, while domestic institutional investors (DIIs) bought equities worth Rs 5,578.71 crore.

Market analysts highlighted the Nifty's notable upward movement following a subdued previous session, projecting further positive momentum with buying opportunities on dips, as long as the crucial support level of 23,000 remains intact.

Rupak De, senior technical analyst at LKP Securities, outlined potential resistance levels for the Nifty, suggesting a range between 23,500-23,600, with profit booking expected only below the 23,000 mark.

Meanwhile, Bank Nifty displayed bullish momentum, supported by its 10-day moving average and forming a bullish engulfing candle on the daily chart, signaling robust buying interest. Experts identified 50,500 as a key resistance level for Bank Nifty, while 49,200 was highlighted as crucial support.

Amidst market optimism, the rupee strengthened, appreciating by Rs 0.11 to close at 83.40 against the dollar. Analysts attributed this resilience to ongoing capital market gains and sustained investor confidence post the general elections, reflecting faith in the economic stability of the NDA 3.0 government.