India-Pakistan ceasefire impact on stock market today: Indian equity benchmark indices, Nifty50 and BSE Sensex, saw exceptional rallies on Monday with both indices rising over 3.5%, their biggest single-day gain since February 2021. The strong stock market rally left investors richer by several lakh crore.Dalal Street saw its wealth increase by Rs 16.15 lakh crore. This surge followed the announcement of an understanding between India and Pakistan to cease all military operations, alongside a positive trade development between the US and China.Nifty50 touched an intraday high of 24,944.80, before closing at 24,924.70, up 917 points or 3.82%. BSE Sensex hit a high of 82,495.97, before closing at 82,429.90, up 2,975.43 points or 3.74%The total market value of BSE-listed companies increased by Rs 16,15,275.19 crore, reaching Rs 4,32,56,125.65 crore ($5.05 trillion) in a single trading session.The easing of tensions between India and Pakistan during the weekend contributed significantly to boosting investor confidence and market sentiment. Additionally, the Indian Meteorological Department’s prediction of an early monsoon, coupled with short covering activities in derivatives, drove the markets higher.Internationally, the United States reported progress in trade talks with China, with both nations agreeing to significantly reduce tariffs on their respective goods during an initial 90-day timeframe.Following the reduction in US tariffs on Chinese imports from 145% to 30%, and China’s reciprocal decrease in duties on American goods from 125% to 10%, global equity markets experienced a significant upswing.Stock market rally in numbers
- Nifty50 today reached its highest level in 7 months. The 3.8% increase marked its most substantial single-day advance since February 2021, when it climbed by 4.7%.
- BSE Sensex is now up over 5% from its December 2024 closing and just 4.1% shy of its all-time high level seen in September 2024.
- The broader market indices demonstrated remarkable performance, surpassing the benchmark indices. The Nifty Midcap 100 advanced by 4.1%, whilst the Smallcap 100 gained 4.3%.
- The IT sector emerged as the frontrunner, with Nifty IT recording a substantial increase of 6.5%, driven by positive sentiment surrounding the US-China trade agreement.
- Among Sensex companies, Infosys led with a 7.91 per cent increase. Other significant gainers included HCL Tech, Tata Steel, Eternal, Tech Mahindra, Tata Consultancy Services, Axis Bank, ICICI Bank, Bajaj Finance, NTPC and Reliance Industries. Only Sun Pharma and IndusInd Bank showed declines among the blue-chip stocks.
- All sectors showed positive results, with IT leading at 6.75 per cent, followed by BSE Focused IT (6.74 per cent), realty (5.87 per cent), metal (5.24 per cent), tech (5.21 per cent), utilities (5.07 per cent), power (4.82 per cent) and industrials (4.24 per cent).
Is the stock market rally sustainable?Siddhartha Khemka, Head – Research, Wealth Management, Motilal Oswal Financial Services says, “Looking ahead, market participants will closely track the release of key inflation data—India’s CPI and the U.S. Core CPI, both scheduled for Tuesday. Additionally, investors will watch quarterly results from major companies including Bharti Airtel, Tata Motors, among others which could drive sector-specific momentum.”“Positive momentum in Indian markets is likely to continue, driven by easing geopolitical tensions, progress on trade deals, and improving signs of economic stability,” he said.Vinod Nair, Head of Research, Geojit Investments Limited believes that while the momentum remains strong, the market may enter a phase of consolidation in the near term as investors await concrete signs of earnings growth. “In the meantime, mid & small caps are expected to maintain the optimism in the broad market,” he says.Rupak De, Senior Technical Analyst at LKP Securities highlights that the Nifty witnessed its best day in four years as multiple positive news developments triggered a risk-on sentiment. “Technically, the index has broken out of recent consolidation across multiple timeframes, confirming a positive trend. Additionally, it continues to sustain above a crucial moving average. Going forward, any dips are likely to be bought into as long as the index remains above 24,350.On the higher end, this leg of the rally might extend towards 25,350/25,750 in the short term,” he says.(Disclaimer: Recommendations and views on the stock market and other asset classes given by experts are their own. These opinions do not represent the views of The Times of India)
