Stock market today: Nifty 50 jumps 2%, hits all-time high: 4 reasons why Indian stock market rose today

Sensex also jumped 2 per cent to hit the intraday high of 73,089.40. However, the 30-share pack is still over 300 points away from its high of 73,427.59 which it hit on January 16 this year.

The buying was broad-based as the BSE Midcap and Smallcap indices also rose over a per cent each during the session to hit their all-time highs of 39,140.16 and 46,169.7 respectively.

Around 11:55 am, the Sensex was 1.8 per cent up at 72,924 while the Nifty 50 was also 1.8 per cent up at 22,084.

Here are 4 factors which appear to have boosted the Nifty 50 to its record high:

1. Positive global cues

The domestic market was buoyed by positive global cues after the better-than-expected earnings of Meta and Amazon.

“Asian shares were buoyed by a late bounce in US tech on Friday as results from Meta and Amazon beat expectations, while investors are bracing for US jobs figures, which could hasten bets for rate cuts if they come in below forecast,” reported Reuters.

Dow Jones rose 0.97 per cent while S&P 500 and Nasdaq Composite jumped 1.25 per cent and 1.30 per cent respectively overnight.

2. Robuts gains in bank, IT, oil & gas heavyweights

Strong gains in shares of heavyweights from the banking, IT and oil & gas space, including Reliance Industries, Infosys, ICICI Bank and TCS, gave a boost to market benchmarks.

The Nifty Oil & Gas index jumped nearly 4 per cent while the Nifty IT index jumped 3 per cent. The Nifty Bank index rose 1.5 per cent.

3. The Budget impact

While the Budget 2024 lacked immediate triggers for the stock market, experts emphasized that the Interim Budget bodes well for the economy and long-term market prospects.

Despite a decline in the stock market following the Budget announcements on Thursday, savvy investors seized the opportunity to acquire high-quality stocks at cheaper prices, driven by confidence in the resilient domestic growth narrative.

Experts found the Interim Budget in line with their expectations and lauded it for its pro-growth stance while balancing fiscal prudence with substantial capital expenditure. This is positive for the economy and the stock market in the long term.

The careful balancing act of the government could keep India on the long-term growth trajectory, creating an optimistic outlook for the nation’s economy.

Also Read: Budget 2024: Here’s why experts find the announcements a long-term positive

“The non-populist Budget focused on fiscal consolidation is a big positive. The big allocation for rural housing will benefit all construction-related segments like cement, steel, paints, etc. Another important budget takeaway is the sharp decline in bond yields consequent to the net market borrowing kept low at ₹11.75 trillion. This is beneficial for banks,” said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

4. Technical factors

Technical experts observe that the Nifty 50 could hit the level of 22,500 this month if the index sustains above 22,150.

“Nifty 50 index has crossed the important 21,800 mark. The Interim Budget indicated a path of fiscal prudence, signalling better times ahead. A close above the previous high of 22,124 should open the doors for the target of 22,575. 20DEMA at 21,600 should act as a support. Traders should trail stop loss suitably,” said Shrey Jain, Founder and CEO of SAS Online.

“If Nifty 50 manages to close daily above 22,150, we can expect the rally to continue towards 22,400 and 22,500 levels by the end of February. However, if there is any move below 21,900, that would be considered an immediate trend change,” said Riyank Arora, a technical analyst at Mehta Equities.

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Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.

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Published: 02 Feb 2024, 12:06 PM IST