The two major Indian equity benchmarks, Nifty and Sensex, turned around on Friday morning with a steady rally after dripping for three straight days, as foreign funds returned and Asian markets traded in the green.
Major Asian markets—South Korea (Kospi), Japan (Nikkei 225), Shanghai China (SSE Composite) and Hong Kong (Hang Seng) were all trading higher on June 20 morning. Moreover, foreign institutional investors (FIIs) bought ₹934.62 crore worth of equities, adding to the ₹605.97 crore cart by domestic institutional investors (DIIs) on Thursday.
Despite the recovery, market watchers such as V.K. Vijayakumar of Geojit Investments believe that a de-escalation of tensions between Israel and Iran is needed for further recovery. “Nifty, which has been trading within the 24,500-25,000 range for about a month now, is likely to remain within this range in the near term. The upper side of the range will be broken only on news of de-escalation of the Israel-Iran conflict or an abrupt end to the war,” reasoned Vijayakumar.
The conflict in the Middle East has been spiking global oil prices week-over-week. However, Brent crude dropped by 2.45 per cent to $76.92 a barrel during the day.
Sensex and Nifty have been sliding for the past three trading days. However, Thursday saw the losses narrow as FIIs returned to be net buyers.
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In the morning session of Friday, Sensex soared by more than 815 points to hit a high of 82,186.37 while Nifty jumped at least 245 points to a high of 25,040.45 points.
Shares of Jio Financial jumped by about 2.50 per cent to a high of ₹291.20 apiece in the morning, while Bharti Airtel stock spiked by at least 2.45 per cent to ₹1921.80 per share, leading Nifty and Sensex, respectively.
Other Sensex gainers included Mahindra and Mahindra, Powergrid, Reliance, HDFC Bank, Tata Steel, and NTPC. Only Maruti Suzuki, Tech Mahindra, and Bajaj Finance were the laggards in the 30-pack benchmark on Friday morning.
Sectorial benchmark indices such as Nifty Bank, Nifty Financial Services, Nifty Auto, Nifty Pharma, Nifty FMCG and Nifty Metal also rallied. The IT and media indices, however, inched slightly lower.
