Stock market today: Sensex, Nifty 50 jump 1% each; why is the Indian stock market rising?- explained with 5 key factors
Stock market today: The Indian stock market experienced strong buying interest on Thursday, May 23, leading to intraday gains of over 1 per cent for both the Sensex and the Nifty 50 benchmarks.
The Nifty 50 opened at 22,614.10 against its previous close of 22,597.80 and jumped over a per cent to hit its fresh record high of 22,860.65 during the session.
The Sensex opened at 74,253.53 against its previous close of 74,221.06 and jumped over a per cent to hit its intraday high of 75,065.36 during the session.
Around 1:40 pm, the Sensex was 1.05 per cent up at 75,003, while the Nifty 50 was 1.06 per cent up at 22,837. The Nifty Midcap index and the Smallcap index 100 were up 0.46 per cent and 0.24 per cent, respectively, at that time.
Experts pointed out the following five key factors that boosted the Indian stock market today:
1. Easing election-related jitters
Ebbing election-related jitters are keeping the market in the green zone. As the market expects political stability after the Lok Sabha elections, investors are focussing on buying quality stocks, as the medium—to long-term outlook of the market remains positive.
“The Nifty hitting a new record is the market’s message of political stability after the elections. The rally is healthy since it is led by fairly valued large-caps,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
According to Bernstein, the Indian stock market may see a short-term rally either leading into the Lok Sabha elections or the week after the results, potentially making the Nifty 50 breach the 23,000 mark. However, this short-term rally may be followed by a profit booking.
2. Macro factor
The market sentiment appears to have got a boost after the Reserve Bank of India (RBI) announced a record ₹2.11 lakh crore dividend to the Centre for FY24. This is positive for the economy as it will help the government meet its fiscal deficit target for FY25.
Also Read: RBI’s record dividend of ₹2.11 trillion to help Centre’s FY25 fiscal deficit, lower bond yields
“The biggest positive for the market is the record ₹2.11 lakh crores dividend from the RBI to the government, which will give an additional 0.3 per cent of GDP fiscal room for the government. This means the government can reduce its fiscal deficit and step up infrastructure spending,” said Vijayakumar.
(More to come)
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