Nifty, Sensex Likely to Continue Rally: 3 Major Drivers Supporting the Bulls
On Monday, June 9, Indian equity benchmarks are likely to open on a strong note and extend their run. As of 7:18 AM, the GIFT Nifty was trading near the 24,173 mark, up 75 points from its previous close.
The following three positive catalysts are likely to help the bulls extend their gains after the RBI’s jumbo 50 bps rate cut bonanza:
Asian equities traded in the green, taking cues from Wall Street's upbeat performance last week. The S&P 500 breached the 6,000 mark for the first time since late February, while the Dow Jones hit a three-month high.
Global cues, domestic macro data, inflation trends, foreign capital flows, and tariff-related announcements will be in focus this week.
Talking about the institutional flow, the DIIs in Indian equities have remained net buyers for the last 14 trading sessions.
On Friday, June 6, Foreign Institutional Investors (FIIs) were net buyers, having bought equities worth ₹1,009.71 crore. Domestic Institutional Investors (DIIs), on the other hand, bought shares totalling ₹9,342.48 crore during the same session.
On Friday, the central bank reduced the repo rate by 50 basis points to 5.50% and slashed the CRR by 100 basis points to 3%, which triggered a sharp rally in domestic markets. The Sensex surged 746.95 points (0.92%) to close at 82,188.99, and the Nifty 50 advanced 252.15 points (1.02%) to settle at 25,003.05.
In Asia, indices traded higher on Monday ahead of critical trade talks between the US and China, scheduled to take place in London.
Japan’s GDP contracted at a slower-than-expected pace in Q1, with annualised GDP shrinking 0.2%, versus the initially estimated 0.7%.
On Wall Street, a better-than-expected jobs report helped calm economic concerns. The Dow gained 442.88 points (1.05%) to 42,762.62, the S&P 500 rose 61.02 points (1.03%) to 6,000.32, and the Nasdaq jumped 231.50 points (1.20%) to 19,529.95. Tech stocks saw broad gains, with Tesla, Nvidia, Amazon, Alphabet, and Apple all advancing.
Senior officials from both countries are meeting in London to ease trade tensions. The U.S. delegation includes Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick, while China is represented by Vice Premier He Lifeng.
Nonfarm payrolls increased by 139,000 in May, slightly above forecasts, with unemployment steady at 4.2%.
Gold eased after the jobs report and on hopes of reduced US-China tensions. Spot gold traded flat at ₹97,170 per 10 grams, while futures fell 0.8%.
Oil prices were mostly flat ahead of the US-China meeting. Brent was at $66.41 per barrel, and WTI at $64.52.
Disclaimer: The article is for informational purposes only and not investment advice.
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