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Sensex hits 64,000, Nifty tops 19,000: These 4 factors drove market rally

Broader markets, too, displayed strength as Nifty Midcap 100, and Nifty Smallcap 100 indices surged up to 1.1 per cent during this period

The addition to MSCI's indices has sent Riyadh stocks into a bull market and brought record fund inflows
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Lovisha Darad New Delhi

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In the past three trading sessions, bulls drove the S&P BSE Sensex 1,033 points or 1.64 per cent higher to notch fresh lifetime highs of 64,012 levels. The NSE Nifty, meanwhile, hit a record high of 19,003 levels, up 338 points or 1.8 per cent in three days.
 
Broader markets, too, displayed strength as Nifty Midcap 100, and Nifty Smallcap 100 indices surged up to 1.1 per cent during this period.
 

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Sector-wise, the BSE Consumer Durables, Metal, Bank, and Auto indices gained in the range of 1.8-2.3 per cent in three days.

That said, analysts believe that the record high levels are sustainable in the long-run.

"Whenever an economy has jumped to $5 trillion from $3 trillion, the stock markets have usually delivered good returns. However, domestic markets have not delivered optimum returns despite a $3.75 trillion economy. In the past, Nifty50 stood around 9,000 levels when the economy was at $2 trillion. The current 19,000 levels from Nifty50 in a $3.75 trillion economy does not suffice. Hence, we have a long way to go and the levels are likely to sustain," said AK Prabhakar, head of research, IDBI Capital.
 
 
Meanwhile, here are the top factors behind markets bull run in three days:
 
FII inflows: Flows from foreign institutional investors have remained buoyant so far in June. On a month-to-date (MTD) basis, FIIs have bought Rs 30,514 crore of domestic equities, whereas they have poured nearly Rs 60,000 crore so far this calendar year (CY23).
 
F&O expiry: According to a Nuvama report, Nifty futures rollover stood at 56 per cent, higher than the 3-month average of 55 per cent, which indicated a strong sentiment prevailing in markets. Moreover, the current upsurge across indices helped traders cover short positions ahead of the June derivatives expiry.
 
Market-wide rollovers, on the other hand, stood at 72 per cent versus 3-month average of 75 per cent, observed analysts.
 
HDFC-HDFC Bank merger: Reports of tentative merger between HDFC twins effective July 1 on Tuesday, June 27, propelled bank stocks, especially HDFC Bank, SBI, ICICI Bank and Axis Bank higher. Shares of mortgage lender HDFC, and private sector lender HDFC Bank gained 2 per cent each in two days post the announcement on Wednesday, June 28.
 
Once the merger is effective, HDFC Bank will become the tenth-largest bank globally. Each HDFC shareholder with 25 shares will be credited with 42 shares of HDFC Bank. READ MORE
 
Heavyweights-led rally: The positive momentum in markets was supported by rally in shares of heavyweights. Shares of Tata Motors, Reliance, Titan, Infosys, Hindustan Unilever, State Bank of India, Tata Consultancy Services, and HDFC Bank gained in the range of 0.4-5 per cent in the past three days.

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First Published: Jun 28 2023 | 2:03 PM IST

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