Indian benchmark equity indices registered a smart recovery on Wednesday, erasing all the losses incurred during Tuesday’s trading, dubbed a ‘blood bath.’ Equity benchmarks: The BSE Sensex was trading nearly one percent higher in early trade, while the Nifty 50 index was also up by nearly one percent.
The Indian stock market had its worst day for four-and-a-half years on Tuesday, falling by about 8%, well below the voting results that suggested a far more decisive win for the BJP led by Prime Minister Narendra Modi.
However, resilient markets showed their strength on Wednesday as the Sensex itself rose almost more than 950 points in pre-opening trading. The level of 50 stocks was 16,071, while that of the 30-share index was 73,547. 58, so it increased by 2 times 468 or has been over increased by 1,468. 53 points. Likewise, the Nifty 50 jumped 2 percent, and all sectors that come under this index climbed amid increased volatility and global concerns. 12% to 22,347. 85.
The recovery to average technical analysts is attributed to short-covering after a sharp decline and concerns over policy continuance, which were heightened by a thin margin of victory for the NDA coalition.
”Stability will return to the market soon as the political wagons are aligning; volatility will remain till there is certainty on the Cabinet & Preferential Portfolios,” opined V.K.Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
He believes that the main destination would be sectors such as FMCG, healthcare, and, which would attract more investors, and that the moment trades might lose their pace. Vijayakumar said investors need to begin slowly nibbling at high-quality large-cap stocks in sectors that could include information technology, financials, auto, and capital goods.
However, analysts also forecast more highs and lows to occur soon in attempting to advise traders to buy and trade with stops on.
