Why the Sensex rose by 1000 points today: an explanation

Today’s stock market: Indian stocks broke their three-day losing streak and soared in Friday morning trades. The 30-stock BSE Sensex rose upon opening and reclaimed the 60,000 psychological threshold. Within a few hours of the stock market’s opening bell, the BSE-sensitive index went on to reach an intraday high of 60,889 points.

In a similar manner, the 50-stock NSE Nifty index rose by almost 280 points and reached an intraday high of 18,141 levels. The 50-stock index rose during the Monday morning trading session, regaining the crucial 18,000 level.

Experts in the stock market claim that major benchmark indices like the Sensex and Nifty have increased today as a result of the US wage growth slowing down in December, which suggests an easing of upward price pressures. According to them, the immediate obstacle for the Nifty is now around the 18,300 mark, while the Sensex is currently seeing resistance at 61,000 levels. We can anticipate that the 30-stock index will scale up to 63,000 if the Sensex is able to pass the 61,000 barriers. Similarly, if Nifty manages to overcome the resistance level at 18,300, it may turn strongly bullish.

What is driving today’s Sensex and Nifty?

Market expert Sugandha Sachdeva explained the gain in the Sensex and Nifty indexes by stating that the “Indian stock market today experienced a robust bounce in early morning deals, matching global cues as wage growth in the US has dropped in December, suggesting a cool-off in upward pricing pressures.” Despite still being anticipated to face significant resistance at the 18,500 mark in the near future, she stated that firm support is in sight at the 17,800 mark, and the Nifty looks to be edging toward an upward trajectory.

As triggers like the US inflation data due this week are anticipated to determine the monetary policy stance of the US Fed, “we may see the benchmark spend some more time in this zone itself in the coming days,” said Sugandha Sachdeva.

“From the standpoint of the international market, the US economic data that was announced on Friday is important. The US economy is strong but cooling, according to all available data, raising the possibility of a soft landing for the US economy. ISM Services data was 49.6 compared to the prior value of 56.5. The number of jobs added in December was 223,000, the fewest in two years. Compared to the most recent peak of 5.6%, the hourly salary increase decreased to 4.6% “the chief investment strategist at Geojit Financial Services, VK Vijayakumar, said.

The expert from Geojit Financial Services continued, “All of these speak to decreasing inflation and the potential for the Fed to become less hawkish in 2023.” With the dollar index falling below 104 and the yield on the US 10-year bond falling by 12 basis points, the market has already begun discounting this. Every signal is bullish.

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Sumeet Bagadia, Executive Director at Choice Broking, responded to a question on the technical outlook on the Sensex and Nifty, “Senex has a solid base of support at 59,500, but it is immediately up against a wall above 691,000. If this obstacle is overcome, it might increase to 63,000 levels soon. Similarly, Nifty is running into trouble at 18,300. When this level is broken, the 50-stock index may turn strongly bullish.”

According to Choice Broking’s Sumeet Bagadia, the levels of 17,900 and 17,700 have been set up as immediate supports for the Nifty.

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