The broader markets also gained momentum with the Nifty
Midcap index rising 3.4 percent and Smallcap index climbing 4.5 percent.
After seeing its biggest
single-day fall on Monday, benchmark indices extended gain for the third
consecutive session on March 26.
The BSE Sensex reclaimed
its 30,000 levels before the stimulus package announcement from the government
but has wiped out about 40 percent gains since.
The index
was trading at 29,380.69, up 844.91 points or 2.96 percent.
The Nifty50 also crossed
8,700 intraday, but now was trading at 8,542.40, up 224.55 points or
2.70 percent.
The broader markets also
gained momentum with the Nifty Midcap and Smallcap indices rising 3 percent
each.
On the sector front, the
Nifty Bank, Realty, Auto, FMCG, IT, Metal, Pharma, Realty and Infra gained 1-6
percent.
Here are 5 key factors
which are driving market higher:
Economic Stimulus Hope
The government has been
working hard to keep the supply chain of essential good intact after
a 21-day nationwide was lockdown announced by Prime Minister.
All regulators are also
watching the situation closely and acting accordingly, to ensure financial
soundness and smooth functioning of the stock exchanges.
Now all eyes are on the
forthcoming economic package.
Nirmala Sitharaman today
announced Prime Minister Gareeb Kalyan Scheme of Rs 1.70 lakh crore, which
will take care of the poor. The Scheme will include cash transfers to the poor
and migrants.
US Stimulus Package
Another reason that led the
market rally was the $2 trillion coronavirus economic relief package announced
by the US Senate members on Wednesday to counter the economic impact of
COVID-19.
Now the voting on bill will
take place in the House on Friday. Experts are hopeful that it will get passed.
Recovery in Rupee
The Indian rupee recovered
sharply today after a rally in equity markets on likely stimulus from the
government to fight the coronavirus pandemic.
Forex traders told PTI that
the 21-day lockdown imposed by Prime Minister Narendra Modi showed that the
government is willing to take hard steps to fight the Covid-19 pandemic.
The currency was trading at
75.22 against the US dollar, up 89 paise from previous close of 76.10 a dollar.
It had weakened by more than 500 paise in last nearly two-and-half-month.
Lower Oil Price
The crude oil prices
continued to trade below $30 a barrel amid steep fall in demand due to COVID-19
led lockdowns in major parts of the world.
The is positive for India.
International benchmark
Brent crude futures traded at $26.89 a barrel, down 1.83 percent at the time of
publishing this copy. It plunged over 60 percent from January highs.
India buys around 85
percent of its oil requirement from overseas.
Technical View
The Nifty50 sustained above
crucial 7,600 levels for the second consecutive session today and formed a
bullish candle on daily charts.
Experts feel the rally
was driven by short-covering and value buying.
They expect the rally to
extend till 9,000 if the momentum sustains but advised not to take aggressive
bets as the uncertainty with respect to coronavirus is still looming over.
"A phase of relief rally seems to be
unfolding and once the index sustains above 8,300 zone expect a larger recovery
towards 9,000 plus. Short-covering rallies a sharper at least in the first
phase of recovery. Given the expected recovery, we have initiated positional
buy on Nifty call option," Amit Shah, Technical Research Analyst with
Indiabulls Securities told.
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