Markets Rebound as Global Stocks Hit New Record Highs
After a three-day decline, the Indian markets closed higher on Tuesday, tracking global rallies as stocks worldwide touched record highs. The Sensex gained 260 points, while the Nifty rose 77 points. The rebound was driven by positive global cues, which helped investors overcome concerns about the ongoing trade tensions and US tariff deadlines set by President Trump.
The Indian stock market’s resurgence was led by gains in the banking, financial, and IT sectors, with major indices such as the Sensex and Nifty50 rising sharply. The Sensex closed at 40,823.05, while the Nifty50 ended at 12,118.30. The broader markets also participated in the rally, with the Midcap and Smallcap indices rising by 1.2% and 1.5%, respectively.
The rupee, however, continued to weaken, closing at 74.83 against the US dollar. The decline in the rupee was attributed to a surge in foreign portfolio outflows, which led to a decrease in demand for the currency. The rupee has been under pressure in recent weeks due to a combination of factors, including the widening trade deficit and the impact of the ongoing trade tensions on the global economy.
In other news, Ola Electric, the electric vehicle (EV) arm of ride-hailing giant Ola, saw Hyundai and Kia trim their stakes in the company. The two South Korean automakers had invested in Ola Electric in 2020, but they have since reduced their stakes due to a decline in the company’s valuation. The exact amount of the stake reduction was not disclosed.
The global markets’ rally was driven by a combination of factors, including positive economic data, easing trade tensions, and a decline in bond yields. The Dow Jones Industrial Average rose by 0.4% to 29,348.51, while the S&P 500 Index gained 0.3% to 3,331.15. The Nasdaq Composite Index also rose by 0.3% to 9,357.99.
The positive global cues were reflected in the Indian markets, with investors optimistic about the domestic economy’s prospects. The Reserve Bank of India (RBI) has been maintaining a hawkish stance on interest rates, which has led to a decline in borrowing costs and a surge in consumption and investment. The government’s efforts to boost economic growth through infrastructure spending and tax cuts have also been seen as positive by investors.
However, the Indian markets are not immune to global risks, and investors remain cautious about the ongoing trade tensions and US tariff deadlines. The US-China trade war has been a major source of concern for investors, with the tariffs imposed by both countries having a significant impact on global trade and economic growth. The US tariff deadlines, which are set to expire in the coming months, will be closely watched by investors, who are hoping for a resolution to the trade tensions.
Despite the risks, investors remain optimistic about the Indian markets’ prospects. The country’s economy is expected to grow at a rate of 7% in the current fiscal year, driven by a decline in borrowing costs and a surge in consumption and investment. The government’s efforts to boost economic growth through infrastructure spending and tax cuts are also seen as positive by investors.
In conclusion, the Indian markets rebounded on Tuesday, tracking global rallies as stocks worldwide touched record highs. The Sensex and Nifty50 rose sharply, driven by positive global cues and a decline in borrowing costs. However, the rupee continued to weaken, and Ola Electric saw Hyundai and Kia trim their stakes. The global markets’ rally was driven by positive economic data, easing trade tensions, and a decline in bond yields. Investors remain optimistic about the Indian markets’ prospects, but they will be closely watching global risks, including the ongoing trade tensions and US tariff deadlines.
Source:
https://www.thecore.in/podcasts/markets-break-out-of-their-losing-streak-836539
