Sensex and Nifty Rally as Metal Stocks Shine and Gold Hits Record High

Benchmarks Stay in the Green

The day began with a strong base. The BSE Sensex received 490 pts almost and then jumped to 82259. Nifty 50 was also keeping the pace and it crossed 25300 mark. Compared to the first wave where the indices were struggling with the steep resistance levels, the later part of the day saw a slight level of profit-booking. In the early afternoon, the Sensex was trading some 100 points higher than it were during the opening at 81960. And the Nifty 50 was trading at about 25 232 which is up by 0.22 percent.

The stock market in India was more successful than the major indices. The Nifty Smallcap index was up by 1% and the Midcap index was 0.5. Such gains indicate that the interest in investments did not focus only on the big names but expanded to other industries.

Metals and Energy Lead the Charge

The metal industry became the leading mover of the performance of the day. Vedanta Ltd stock has increased by more than 4% to an all time high of 738.80. This was after the board of the company approved a stake sale of its subsidiary, Hindustan Zinc, through an Offer for Sale (OFS). During the period of the rush of Vedanta, Hindustan Zinc shares had fallen by about 3% as investors realigned themselves to the news of a 1.59 stake sale.

Energy equities also proved to be active. ONGC stock also increased by over 5 percent to reach a new 52-week high of 262. The jump was triggered by the fact that the company had announced a huge shipbuilding deal with South Korea-based Samsung Heavy Industries on very large ethane carriers.

Conversely, not every industry was involved in the rally. The stocks of automobile and FMCG withstood the selling pressure in which both of the indices fell almost 1%. Asian Paints was one of the slowest, its share price had decreased about 6 percent after its recent quarterly reports.

Vodafone Idea Narrows Losses

Vodafone Idea acted as a center in the telecommunications industry. Tuesday confided the third-quarter outcomes of the company showing that consolidated net loss has reduced to ₹5286 crore. This was a better result compared to previous quarters which was mainly due to the improved customer care and a gradual increase in average revenue per user (ARPU).

The slight decrease in the losses led to a positive reaction in the market whereby the stock increased by more than 1 percent to trade at almost 9.95. Analysts observed that despite the company still having a high debt level, its stable operational indicators offer a ray of hope of a sustainable long-term recovery.

Gold and Global Cues

Beyond the equity market, gold ran the headlines and hit an all-time peak of $5220. The rise of the yellow metal is very often an indication of a wary attitude by the international investors but the Indian equity market was resilient.

There was a mixed result with global cues. Whereas Wall Street S&P 500 set a record high overnight, the Asian markets, including the Nikkei of Japan, were struggling. However, the recent news of the Free Trade Agreement (FTA) between India and the European Union went on to strengthen the domestic mood. Observers believe that this deal will particularly help textile exporters to have a zero duty entry into a huge European market.

Looking Ahead

Shareholders are currently watching the future policy move of the U.S Federal Reserve. Most of them expect the Fed to put its interest-rate cuts on hold at least in the short-term due to the stabilising labour market in the United States. There is also domestic market preparation towards the Union Budget which is likely to be the accelerator to the next stage of the rally.

In the process, the traders will be watching how the Nifty will manage to hold its position above 25 200. The market volatility is estimated to continue till closing bells as there are more than 100 companies that are to report earnings today, such as L&T and Maruti Suzuki.

Also read: Stock Market in India Under Pressure | Sensex Tanks 1,000 Points