April 10, 2020 3:04:30 am
Stock markets on Thursday gained another 4 per cent, amid expectations of more stimulus measures and reports of COVID-19 infections peaking and coming down in the near future. The Sensex rallied by 1,265.66 points, or 4.23 per cent, to 31,159.62 and the 50-share Nifty increased by 363.15 points, or 4.15 per cent, to 9,111.90. With this gain, the Sensex has recovered 12.93 per cent, or 3,668 points, during the week.
Vinod Nair, head of research, Geojit Financial Services, said Indian markets, in sync with global markets, were up again on expectations of infections peaking out and more stimulus measures to be announced.
“On the back of positive global cues, the market rose on spirited all-round buying. Automobiles, financials and pharmaceuticals led the charge despite profit booking witnessed during the session. Today’s trade saw even consumer discretionary and consumer durables stage a comeback ahead of expectations of a stimulus to help MSME weather the pandemic,” said S Ranganathan, head of Research at LKP Securities.
Indian indices jumped higher during the week taking significant cues from its global peers, mainly from the US bourses.
Recent uptrend may be short-term
Markets are keenly awaiting another stimulus to revive the economy battered by Covid-19. There are expectations that worst affected sectors and MSMEs may get some relief in the package to be announced by the government. While the Sensex has shot up by over 3,500 points this week, analysts say the uptrend seems to be a short-term bear market rally and may not be sustainable.
“Confidence returned with reduction in the number of daily COVID cases in some countries. Sentiments are changing from ultra-pessimistic to mildly pessimistic, which is driving markets higher. However, one must not forget the trillions of dollars of economic stimulus packages in the US, Japan and other economies that have boosted confidence to a large extent,” said Jimeet Modi, founder and CEO, Samco Securities.
According to analysts, once the lockdown is lifted, markets will take note of the ground reality and react accordingly as the aftereffects of the lockdown will emerge only then.
Meanwhile, the rupee fell to a new intra-day low against the US dollar despite strong traction in domestic equity markers.
It opened at 76.09 before sliding to a record low of 76.55 against the dollar. However, the domestic unit pulled back to finish at 76.28 as against its previous close of 76.34.
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