markets: Indices surge to 3-week highs on global cues

Mumbai: Indian stocks rose 1% on Tuesday to a three-week high, supported by recent positive undertones in global markets, helped by the UK’s withdrawal of fiscal stimulus.

The BSE Sensex closed at 58,960.60, up 549.62 points or 0.94% from the previous close. The Nifty gained 175.15 points, or 1.01%, to finish the day at 17,486.95.

Elsewhere in Asia, most major indices were up 1-2%, while major averages in Europe were up 0.2-0.9%. In the US, the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite were up around 0.9% at press time.

At home, the Nifty broke a key 17,400 hurdle while the volatility index, or VIX – a measure of fear – fell, suggesting traders see less risk of market downside in the near term.

“Last week the India VIX cooled below 18.5, prompting ‘buy on dips’ in both indices and equities,” said Sudeep Shah, Head, Technical and Derivative Research, SBICAP Securities.

Refined


FPI Selling Moderates in Oct

“The positive cues from global markets have taken Nifty towards 17,400 levels, which is acting as a strong resistance level,” Shah said.

The VIX closed at 5:45 p.m. Tuesday, down 5.24% from the previous close.

Foreign portfolio investors (FPIs) were net sellers of Rs 153.4 crore on Tuesday, preliminary stock market data showed. Domestic institutions bought shares worth Rs 2,084.71 crore.

Overseas sales have softened to around Rs.8,3 trillion so far in October versus Rs.19,000 crore net outflows over the last 10 days in September, prompted by a further 75 basis point hike in interest rates by the US Federal Reserve and geopolitical tensions.

“A large amount of hot money that entered Indian markets at the time of the pandemic has drained,” said Rakesh Arora, Managing Partner of Go India Advisors. “It doesn’t mean that foreign investors will stop selling now or in the coming months, but we do see the selling pressure easing. This will give the Indian rupee some time to consolidate against the dollar.”

https://economictimes.indiatimes.com/markets/stocks/news/indices-surge-to-3-week-highs-on-global-cues/articleshow/94952806.cms markets: Indices surge to 3-week highs on global cues

Russell Falcon

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