The Reserve Bank’s committment towards commitment to support the ongoing economic recovery along with reduction in investors’ anxiety over Omicron variant lifted India’s key equity indices — S&P BSE Sensex and NSE Nifty50 — for the second consecutive session on Wednesday.
The RBI’s MPC voted to retain its key lending rates along with the growth-oriented accommodative stance during the penultimate monetary policy review of FY22.
Initially, Nifty opened with a gap up and rose gradually through the day with minimal corrections. Globally, markets in Asia advanced after a broad-based rally occurred on Wall Street. Besides, a rebound in market sentiment continued in early European trading with global shares set for their biggest two-day jump since November last year as investors became less concerned about the Omicron variant.
On the domestic front, realty, metals, auto, telecom, IT, and bank indices rose the most.
The S&P BSE Sensex closed at 58,649.68 points, up 1,016.03 points or 1.76 per cent from its previous close. The broader 50-scrip Nifty at the National Stock Exchange (NSE) ended the day’s trade in the green, up 293.05 points or 1.71 per cent to 17,469.75 points.
“Nifty has risen sharply over two days. The next resistance is at 17,564 while the support could come in at 17,252,” said Deepak Jasani, Head of Retail Research, HDFC Securities.
“Sharply positive advance decline ratio hints at some more upside in the near term.”
Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services, said: “Indian equity market witnessed strong positive momentum for the second consecutive day on the back of positive global cues and status quo maintained by RBI policy committee.”
“Both Nifty and Bank Nifty are recovering well from the recent correction. Strength is clearly visible along with strong buying interest in the market. Hence traders are advised to maintain a buy on dips strategy for the next few days.”
Vinod Nair, Head of Research at Geojit Financial Services said: “Fears over Omicron faded as recent reports suggested that the new virus isn’t as deadly as earlier anticipated and this helped the market to add-on to recent strong gains.”
“The market turned positive over RBI’s continued accommodative stance and MPC kept the rates unchanged. The GDP forecast for FY22 remained high at 9.5 per cent showing confidence over economic recovery and inflation forecast is below the market estimates.”