Since the outbreak of the global COVID-19 pandemic, the stock market outlook remained reserved. So, it is no wonder that the news of vaccine will give market the boost it has been looking for. NSE benchmark, Nifty50 on Tuesday, has set a record by climbing the 13,000 marks amid extensive buying in different categories by foreign investors. Favourable global cues have lifted investor sentiment. They expect liquidity to remain high after Joe Biden appoints Janet Yellen as the new Treasury Secretary.
Better Than Expected Corporate Performance Boosted Investor Confidence
Despite weak market prediction amid deteriorating economic performance, most companies reported positive results in Q2FY21.
Banking stocks that have significant weighting on the indices continued to remain buoyant after RBI agreed to accept working committee recommendations. Several banks also reported a YOY increase in revenue and profit in their Q2 report, which also helped keep the market upward.
US Presidential Results
US blue-chip index, Dow crossed 30,000 marks after the news of Biden’s win. Indian market is hopeful that Biden’s election will also bring good news for the Indian companies, especially in the IT segment.
Even a week ago, there were uncertainties regarding COVID-19 vaccine. But Pfizer’s announcement on the progress of vaccines with high efficacy has spurred hope in the market. Investors invested heavily in hotels, banking, and aviation stocks, hoping for faster recovery in these segments once lives return to normalcy.
What Happened In The Market On Tuesday?
Nifty gained about 12 percent this month, follwoing an inflow of approximately USD 7 billion in foreign institutional investment (FII). The buoyant sentiment is aided by the announcement of a vaccine.
On Tuesday, nifty 50 crossed 13000 marks, gaining 1 percent. Nifty closed at 13,055 or 128 points higher after renewed buying in banking stocks
Nifty crossed 12,000 marks last year in June. It took 368 trading sessions for Nifty to rise by 1000 points
In BSE, Sensex closed at 44,523 points after gaining 446 points or 1.01 percent. It touched 44,500 marks during intraday trading before closing in green
Analyst’s underpinned the gain to the possibility of a vaccine. All Nifty sub-indices recorded gain on Tuesday, with banking stocks leading the front. Better-than-expected corporate results for Q2FY21 have prompted analysts to review and upgrade possible earning estimates for several sectors. Undoubtedly the market is currently feeling hopeful about faster economic revival, and the trend may continue.