The Indian equity markets saw significant gains on Wednesday following the long-awaited trade deal with the European Union, sparking optimism for economic growth. Sensex rose by 545 points, reaching 82,402, and Nifty climbed by 183 points to 25,359 by 9:30 am. Both broad-cap indices and sectoral indices performed well, with Nifty Midcap 100 up by 0.77% and Nifty Smallcap 100 surging by 1.17%.
All sectoral indices, except FMCG and PSU bank, were in the green. Nifty oil and gas led the gains, rising by 2.42% due to a surge in global oil prices, touching levels last seen in October at $67 per barrel. Realty, metal, and media sectors also showed notable gains of 1.54%, 1.17%, and 1.45%, respectively.
Market analysts highlighted that foreign institutional investors (FIIs) continued to sell due to high valuations, modest earnings growth, and rupee weakness, while domestic institutional investors (DIIs) were buying on expectations of earnings recovery. The market also saw significant short positions from FIIs in index futures, which could trigger a market rally upon short covering.
In the Asian markets, China’s Shanghai and Shenzhen indices rose, while Japan’s Nikkei fell, and Hong Kong’s Hang Seng Index gained. South Korea’s Kospi also recorded an increase. The US markets closed mostly higher, with Nasdaq, S&P 500, and Dow showing varied movements.
Investors are now looking towards upcoming quarterly earnings reports and the Union Budget presentation on February 1 for further market cues. On January 27, FIIs sold equities worth Rs 3,068 crore, while DIIs bought equities worth Rs 9,000 crore.
